Thread by @SquigglyRick

"Of all the checks and balances already existing within the executive arm of the Commonwealth Government, they were apparently ineffective to cause even a suspension of the [Robodebt] scheme in the face of its dogged pursuit by Services Australia and the then government."

Covering the Robodebt Royal Commission this week. Won't be able to live tweet the entire thing, but will do my best to keep on top of everything. Full report this weekend.

Follow also @Asher_Wolf, @DarrenODonovan, @lukehgomes and others I imagine!

@Asher_Wolf @DarrenODonovan @lukehgomes Starting with the September 2019 Solicitor-General advice to the Commonwealth that "ought be properly understood as a legal position about the scheme which always existed."

That line, from senior counsel assisting Justin Greggery KC, will be very important I suspect.

Before and during Robodebt implementation, advice from internal legal departments was sought. DSS advice as early as 2014: "The proposal to smooth a debt amount over an annual or other defined period may not be consistent with the legislative framework."

This was consistent with the SG advice almost 5 years later. Greggery says "we deduce" the reason no authoritative advice was obtained prior to September 2019 was because advice in one form or another within DSS "created an expectation... that the advice may not be favourable."

In other words: they knew.

This is pretty significant stuff. See:

https://twitter.com/DarrenODonovan/status/1586877318005391364

The SG advice from September 2019 says there is literally NO reason why averaged ATO data can provide any accurate foundation for the calculation of a social security debt owed to the Commonwealth.

In effect, the SG advice concluded that "an officer is required to make inquiries to attempt to ascertain the true position" in how a customer's income was distributed. In other words: the onus was on the government to ACTUALLY CHECK if there really was a debt.

This Solicitor-General advice on Robodebt is pretty much as big of a trashing of the entire basis for the scheme as one could imagine. Its final answer to questions from govt: you can't do this without changing the legislation.

Re: customers who received debt notices and did not engage. "The failure to respond does not provide positive proof of a debt" and certainly does not allow a decision-maker to "speculate" as to the "facts."

Greggery: "The opinion of the SG raises questions which can be answered by people of seniority about how a scheme that was so lacking in legal foundation was established, implemented and maintained for a period of almost three and a half years in a partly automated fashion."

People of seniority: your time to explain what happened has finally arrived.

Can't imagine how this must feel to hear from people who were vicitmised and gaslit by an entire government for so long.

Like, I know we have spoken about this for some time now but we have conclusive proof on day 1 of the this royal commission that the government literally ~made up debts~, they KNEW they were making them up and had no legal basis, and they did it anyway.

The earliest advice that RC has obtained from the Commonwealth is an advice of Simon Jordan "second counselled" by Ms Ann Pulford (in house DSS lawyers). Not sure on spelling. Referred to this earlier, December 2014.

This advice was prepared ~before~ Robodebt was even in its pilot phase.

The request for this internal advice came from an assistant secretary Mark Jones, who will be giving evidence at the royal commission tomorrow. He thanks for the advice on the "DHS data-matching issue."

We are hearing now about early meetings between DSS debt policy teams and the equivalent at Department of Human Services. This is a good case study in authorship of policy. Ministers wanted savings, always, but this algorithm was born out of department brainstorming.

So as public opprobrium kicked up over Robodebt, more advice was sought in January 2017. With a "very big proviso", Anne Pulford gave advice that differed from her 2014 co-advice & introduced concept of whether there is "sufficient doubt" a social security payment was overpaid.

Pulford will be on the stand tomorrow to explain if she meant there to be a difference in the thrust of her advice and, if so, why that was. It is certainly very interesting to see the parameters apparently shift on what was lawful between 2014 and 2017.

Finn Pratt and Kathryn Campbell, heads of DSS and DHS respectively, are name-checked now by senior counsel assisting. What did they know and what did they request be done? Stay tuned for their evidence in coming days / weeks.

DHS legal counsel Annette Musolino still hasn't provided her statement to the royal commission. Commonwealth promised that it would arrive today. The situation is "most unsatisfactory."

Ms Musolino became unwell, we are told, on October 13 though the information about how or why "has been sparse" and communication lacking between RC and Commonwealth. She has been issued a summons for next week.

lol wtf, Commonwealth Ombudsman and former staff are not compellable by royal commission but commonwealth tells us he may consider "voluntarily" assisting the RC. There has been no indication that this will actually happen. This is wild.

But given the complete lack of rigour in the Ombudsman's Robodebt checks, I am not in the least surprised.

"It has become clear that a misunderstanding has emerged as to the extent of the commonwealth's waiver of legal professional privilege," sca Greggery KC says. In other words: govt walking back this commitment.

Gotta say, as they head to a brief morning break (QLD time) that Commissioner Catherine Holmes did not come here to fuck around and does not much like playing games or assorted nonsense.

And this, this is the energy I respect the most on this matter.

Catching the tail end of today's hearing and Commissioner Holmes is arcing up again, warning the Commonwealth's counsel that "I am simply not having a situation" where documents are not being made available to the commission because they are marked "protected."

This is somewhat separate to the matter, still to be resolved, about documents subject to public interest immunity

Anyway, while I'm on my "lack of trust in the sections of the senior public service" hobby horse, Day 2 of the Robodebt Royal Commission is due to begin in 11 minutes or so. I'll be continuing yesterday's thread here. It's a super thread.

And Robodebt RC is underway.

We are using the first bit of time to resolve some ongoing questions about legal professional privilege and public interest immunity the Commonwealth is claiming on some documents. Dominique Hogan-Doran SC, for the Commonwealth, is up to discuss.

Documents relating to Anne Pulford, who gave internal legal advice for DSS in both 2014 and 2017, are fine to be included in the commission. They were the basically the remaining ones with a question mark re: legal professional privilege.

So, we have a "mystery". There are a bunch of documents which have been identified and given document ID numbers ~for the purposes of this royal commission~ but somehow the Commonwealth can't find them in its system. And we are not sure how they came to be identified.

Commissioner Holmes, like me, begs: "You're losing me!" And senior counsel assisting Justin Greggery can only throw his hands up and say, essentially, we have no idea how we have come to identify documents the C'wlth does not appear to be able to find.

Some other legal things are happening which I won't pretend to understand. Here's an observation though: the live stream has Commonwealth counsel Timothy Begbie listed as Timothy Begbievic and I've Googled but it appears to be an error?

Oh, we have a 'constitutional risk assessment' document on which the Commonwealth is NOT waiving legal professional privilege. They say they are open to further discussions on this.

OK, counsel also need to figure some stuff out. We are adjourned for 15. I like the idea of adjourning when you need to figure stuff out. Going to carry this into my regular life.

We back babies. "Substantial progress" has been made on whatever it was they were trying to figure out. Something something documents something. Now we get to resolve the question of public interest immunity, which is important.

Counsel assisting Angus Scott says the question of public interest immunity is extremely important and wants the question dealt with as openly and transparently as possible. A mantra we can all live by.

Timothy Begbie, for the Commonwealth, says it "seems to us that it is very important that this Commission's ruling on this legal question" conform with previous legal authority. The "very essence" of this exercise is whether cabinet confidentiality outweighs public interest.

As @DarrenODonovan has noted far more eloquently than me, argument at the moment is dense but boils down to: the C'wealth has a desire to protect cabinet confidentiality and even docs prepared FOR cabinet consideration because this process should allow free and frank discussion.

OK I don't think we gain much from me tweeting this legal argument bit. I'll keep listening until something happens. Have been doing some admin behind the scenes and cannot help you here. Back soon!

Legal argument, citing previous cases, is essentially any cabinet document, submission, any "pre-cursor" document prepared for cabinet is untouchable but also any other document prepared after the fact that alludes to it, or allows "reliable inferences" to be drawn about cabinet.

They call this "mosaic analysis" which is a cool term. Pulling bits and pieces of info together that, on their own might not be subject to public interest immunity but which together produce a revealing picture. To do mosaic analysis, first we must create the universe.

Lol the Commissioner Catherine Holmes just told Commonwealth counsel Timothy Begbie "you're coaching your grandmother a little" as he tried to explain how she might make a decision on balancing public interest test on certain documents.

The C'wlth basically ran a computer program to overly cautiously pre-render documents as public interest immunity without actually reading them. Commissioner: "Isn't it a computer program that got us here in the first place?" Begbie: No comment.

To be fair to them, Begbie did say that it is quite possible when they do get around to reading these docs and checking that no PII claim will actually be made. So in terms of getting around to checking the assumption, it's a bit quicker than Robodebt.

Angus Scott, counsel assisting the Royal Commission, reads from the home insulation (pink batts) royal commission which found cabinet deliberations were safe but outside of that, basically, all bets were off. Commission considered these docs as it saw fit.

Commissioner Holmes says the specific wording of her terms of reference are not the same as for the pink batts inquiry, namely re: "decisions" taken by the Australian Government.

Counsel assisting Angus Scott says this is true, of course, but the key term is "Australian Government" which is present in both terms of reference and this commission is required to examine how it responded, acted, or otherwise moved to design and implement Robodebt.

"If there are things that are important in working out how this scheme came into play, little hard to report on it without talking about the documents that evidence that," Commissioner Holmes says, not liking idea of non-publication orders.

"I think that if they're very important, then we're going to need to expose what actually happened." Basically Commissioner says if she finds a document IS in the public interest, then she wants it un-redacted and disclosed in full open hearing. Not considered in private.

So they're about to adjourn so Commissioner can Consider Some Things and will come back at "not before 2pm" for an in camera (closed) discussion. Will we even get to the witnesses today??

That is 2pm Brisbane time / 3pm AEDT I assume.

You know what this means? The haircut I booked yesterday for 3pm today was about as well-timed as the NASA Dart Mission.

Had to bow out for a couple of hours but I'm back listening to Mark Jones, former DSS assistant director who sought legal advice on the Robodebt pay-as-you-go taxation data-matching proposal. That advice, remember, was: this would be illegal.

There was a moment between 2014 and 2015 when the proposal was essentially dead in the water. Something changed, and it was back on the agenda in 2015. Mr Jones does not know, he says, who decided that this should go ahead.

163,000 data matches were forecast in the first year to more than 450,000 in a later year ((1,080,028 matches all up) with average debt gradually decreasing. Of this figure, some 866,857 unique customers. Just a whole bunch of figures to them. Not people with concerns or fears.

So in terms of the policy proposal process, the Department will package up a range of options that are shown to the Minister's Office. Proceeding with the PAYG datamatching option was one such proposal that was bundled up and presented to the MO.

Mark Jones: "I would have assumed that it would have required legislative change."

Mark Jones: "I did not, to my knowledge, receive any other legal advice that was contrary to the Jordan [2014 legal] advice."

On 18 December 2014, legal advice was given to Mark Jones by Jordan with Anne Pulford copied in. Remember, it said, in short, 'you can't do this without knowing actual income'. Did Mark have any questions about their advice? "No."

31 October 2014 email from Mark Jones asked colleagues for advice on the DHS proposal, specifically whether it was appropriate because of the income testing rules. David Mason writes back: "We can't see how such decisions could be defended in a tribunal or court."

Mr Mason is firm and clear, says if they did this they couldn't allow debts raised in such a way to ever reach a tribunal or court. He went on to say that the project could cause "reputational damage" to both Human Services and DSS.

"I certainly would have raised concerns within the team," Mark Jones says, after finding out the program was proceeding. Do you recall whether there was any conversation at any point of time outside of your team that the view of DSS had shifted? "I can't recall."

But acting group manager of social security policy Andrew Whitecross, according to Jones, was provided with the combined policy and legal advice. This was then sent as a summary to Serena Wilson, who was higher ranking than Whitecross.

Would you ever raise an issue with Ms Wilson if there was something you had a problem with, Commissioner Holmes asks Mark Jones. Jones says "no" before she is even finished asking the question. "I'm quite low down the chain," he said.

Commonwealth's senior counsel Hogan-Doran now questioning Mark Jones. She brings up an email sent 16 January 2015 by Jones to Andrew Whitecross which appears to be both the legal and policy advice that was shown to him.

Makr Jones was given access to his historical DSS emails on 21 October this year. There "appeared to be some missing" and further emails were provided to him on 31 October. "Those emails primarily related to some of the evidence that has just been presented," he said.

He only got access to an additional bundle of his emails today.

Mark Jones is excused and there's only 10 minutes left in the day so they won't call Anne Pulford today. Starting half an hour earlier tomorrow (9.30am AEST). I'm gonna go chop some onions!

DAY THREE of the Robodebt Royal Commission, I will continue my thread here. Anne Pulford about to be called shortly, she was copied on legal advice in 2014 and authored new advice in 2017 which appeared to change the emphasis of what was being allowed. More soon.

DHS executive minute to Scott Morrison contained a raft of measures, one of which was the PAYG / Robodebt compliance scheme. Being relied upon today. Anne Pulford being sworn in now.

Anne Pulford is the principal lawyer for the Department of Social Services.

Pulford being asked about the 2014 Jordan advice (remember: it basically said, Robodebt is not legal) and it being "second-counseled" by Ms Pulford. Is she familiar with the term? She is. He was asking her effectively to review his advice. "Yes," she says.

Pulford responds to Jordan's request at the time: she suggested the removal of just three words. "What you are conveying... is that you have perused the advice, you were happy with your name to be attached to it... and that you considered that the advice was sound." Anne: yes.

This is important set-up because it was Ms Pulford in 2017 who authored new internal legal advice which appeared to walk-back this first advice. We know that the Solicitor-General in 2019 confirmed every ounce of the 2014 advice, so what's the go with 2017?

The original question was: "Would a debt raised in this way be defensible in a tribunal or court." Anne Pulford understood the context of the question and the advice being prepared to answer it, although she says her understanding is based on the documents not independent recall.

Whether a debt amount derived from annual smoothing would be legally defensible, the answer was no, wasn't it? Anne Pulford says "broadly, that's correct."

There is a "foundational factual point" that the only debt that could be raised was one based on knowing how much a customer earned in the fortnight the debt was raised. Foundational factual point, will also become important I suspect.

Anne Pulford asked about the policy advice from payment rates and means team within DSS which was essentially "we have concerns about this." Does it appear these points were cogent? "Yes," she says.

So when a policy proposal comes from DHS to DSS for legal advice, would that be shared with them? Pulford says she expects the gist would absolutely be shared.
"Would you agree with me that the gist of the DSS view was a very strong 'no'?" Justin Greggery asks.
Pulford: "Yes."

Current discussion is about a January 2015 email on which Anne Pulford is included which shows both Catherine Dalton (an EL2 director within DSS) and Andrew Whitecross (group manager within SES) knew about the 2014 legal advice saying in short 'no way, bad idea.'

By March 2015, there is a signed brief from DHS - despite the clear no from DSS - conveying that the Minister wanted a range of measures for potential inclusion in the 2015/16 budget and one of those was for this particular proposal.

Scott Morrison was Social Services Minister from 23 December 2014 to 21 September 2015.

Of course, history tells us that, after this, he became Treasurer.

So back to March 2015, Catherine Dalton emails Anne Pulford with updated draft brief. "Minister Morrison has requested that the DHS bring forward proposals for strengthening the integrity of the welfare system."

The email continued: "And given the quick turnaround required... the Social Security Performance and Analysis Branch has provided comments highlighting the need for legislative change, as well as the shift away from underlying principles of social security law."

Catherine Dalton: "We would appreciate your scrutiny of the proposals and advice on any legal implications/impediments. What action would need to be undertaken to resolve legal issues."

This is a big deal. They knew they had to change the legislation to make this thing legal. Of course, that never happened. This royal commission will ask: why?

Catherine Dalton, still on new version of draft brief on fraud and compliance to David Hertzberg (sp), a senior lawyer. "Urgent advice required" on "new policy proposal (NPP)" strategies "cleared by Minister Morrison for DHS to take forward."

Dalton notes that the DHS draft brief had a huge gap: the checklist noted that "no legislation is required." Ms Dalton said "we are concerned the strategies may require legislative change (significant)." This is wild.

At this point, the timelines are incredibly tight because the budget is due in 12-15 weeks. "It appeared that the very tight timeframe and the pressure was coming from a clearance by Minister Morrison," Greggery asks Pulford. She says: "Correct."

So under the strengthening the integrity of the welfare payments scheme there are a number of proposals. One is a proposal to investigate, detect and prosecute suspected non-compliance. "Utilising new technology to increase data analytics," etc is offered.

The second last point is "includes a focus on active confirmation by welfare recipients of information provided by an online declaration process." Active confirmation jfc.

900,000 additional fraud investigations, gross debt and savings of $1.2 billion.

Over the page, point 7, red font by Catherine Dalton notes that the obligation is placed on the customer to ensure their record was correct and to provide evidence. "Clean-up outstanding variances," is the phrase used.

"We need to know the scope of the legislative change required to bring this into effect and any implications for the purpose and intent of Social Security Law," Dalton writes. Need. To. Know. She is all across this.

Short morning break of 15 minutes.

My understanding of this so far is that DSS has repeatedly and consistently said "what the fuck" while DHS has apparently gone behind their backs, or not listened, or deliberately acted against concerns to advance a proposal to Scott Morrison which he liked the look of.

Of course, when the political heat gets applied later that steadfastness on behalf of DSS may well (did?) soften somewhat. Fascinated to hear how, when we get to it.

Back from the break now, I ran up and down my stairwell 7 times because I haven't had time to do my walk yet today. Is this important? No. Back to the commission:

So senior lawyer David Hertzberg writes back to Dalton. Would need to look carefully at secrecy provisions on Taxation Administration Act 1953. Pulford agrees this is a "significant issue that was identified."

There was a real question to be explored about the use that the taxation data could be put, Greggery KC says. If there had been more time available, he says, DSS might have been able to explore this in more detail? "Yes," Pulford says.

Hertzberg continues the ATO information is "proposed to be afforded some sort of special status as primary evidence." He says "I'm not sure the current Social Security law would accommodate this conception."

This is an additional legal question identified by him, Pulford agrees, because it differs slightly from the question of ~averaging~ that data in the 2014 advice.

Hertzberg said rules would likely need to be inserted into the Social Security Act which makes it clear that a person's employment income is defined to be the amount of income sourced from the ATO unless another person has provided information otherwise.

Hertzberg also said there would need to be "review rules" put in place to allow change if the ATO information was used but other detail was later made available that showed this to be incorrect. In short: there are even more legal barriers than first thought, Pulford agrees.

Pulford reviewed this Hertzberg document. She was "effectively satisfied that they focused on legislative implications." Yes, she says. She had no additional comments. This brings us to 4 March 2015.

The DSS position on the legal front had not only not changed but had added more issues. Is she aware or would have expected that very senior people in DSS would have been made aware of this new advice? She would have expected this, yes.

Greggery KC: The significance of this from a legal perspective had gone from "something between the two departments to something that went all the way up to the Minister." Pulford agrees with this assessment.

Commissioner Holmes points out the brief signed by Morrison also includes the proposal for administrative sanctions (a recovery fee) and notes this would also require amendment to the Social Security Act.

Streamlining of prosecutions based on overpayment was flagged as something needing legislative amendment. "Could become critical," this is noted by Catherine Dalton. "Are there also issues under the Evidence Act in terms of inducing self-incrimination?"

Hertzberg's advice did not detract from the 2014 advice, but identified additional legal questions "that did not appear to be favourable to the new policy proposal." Pulford answers: correct.

Moving into 2016 now. July 4 email with some attachments. Regarding the 10 per cent recovery fee in the "online" iteration of Robodebt. Essentially, applying a fee on a customer who is ~raising their own debt~ by self-declaring online, there is no administrative cost to Dept.

The consensus in DHS appears to have been that the recovery fee was there as a compliance incentive rather than to recoup any administrative costs. 1 October 2015 email from DHS to Catherine Dalton at DSS seeking clarification of the application of debt recovery fee.

"Depending on what is possible under legislation / policy, we are considering three options," DHS email to DSS says. Including "utilising the recovery fee as a lever to influence customers to enter into a recovery arrangement at that point."

In Mafia circles, this is the equivalent of threatening to firebomb your fucken laundromat.

By the time the budget measure was announced in May 2015, the many many legal issues raised were not resolved. Pulford says that is her understanding. The measure, due to begin on 1 July 2016, is still cloaked in uncertainty by late June that year. No legal issues resolved.

Now, regarding letters sent to customers telling them owe a 'debt'. Email to Anne Pulford and Catherine Dalton 22 June 2016. Draft letter attached but there was a different letter developed: a staff-assisted letter that provided a phone number as an alternative contact.

The first letter was preferred, as it asked customers to just go on MyGov to supply details. The other letter was a "different category" and not preferred because it involved actual people to mediate the process of dealing with the customer.

"Past experience shows that if an alternative phone number is provided a significant proportion of recipients won't engage online," this document days. Basically: there was a deliberate choice to get customers to go online and withhold a phone contact.

They are describing here a motivation to have welfare recipients herded like cattle through certain gates that would both increase the amount of 'debt' recovered, but also to raise additional money off the back of 10% recovery fee. All of this required they be deceived.

Final advice from Pulford on letters: "We understand that at all times, the person is subject to a notice under subsection 68(2) of the social security act." Pulford says she thinks the advice was "sought on the basis that the debt was valid." This was a scheme in full operation.

Pulford says she would have understood that Robodebt was fully operational. Greggery: "Where did you move then from your advice in 2014 to an assumption that the debt would be valid, that is, accurate?" There is a very long pause. "I don't think I can answer that question."

"I don't have a recollection of the precise events occurring," Pulford says, in between and with long pauses. But you concede's Greggery's point that nothing factual has changed based on the advice from 2014. "Correct."

Anne Pulford's counsel has just objected to a question from the senior counsel assisting. He rephrases. The 2014 and 2015 advice "goes to the heart of the validity of the scheme." Why wouldn't this have been mentioned? "A government decision would have been made at that point."

Pulford says to bring up all of this again, now, as the program is about to roll out after government decision that "I don't think would have been regarded as helpful by our client area." By which she means: to continue the business of the dept in implementing government policy.

"The two are in conflict," Pulford says. "The role of the internal area is to make clear risks which government then decide."

Version of letter which Pulford said needed to include explicit reference to the consequences of not responding. "What you need to know: a 10 per cent recovery fee may be added to the debt amount." She says to Commissioner she would have expected more information to be provided.

Counsel everywhere asking if they can get a moment.

February 2017, flurry of emails from Pulford to DSS chief counsel Janine Richards (SES Band 2) re: more advice. There has been a public backlash and Ombudsman review around January/Feb that year. DHS brought into this email chain via Annette Musolino, chief legal counsel.

Adjourned until 2.30pm. Papa is going for a WALK.

Again, that is 3.30pm AEDT / 2.30pm AEST.

Back from my walk where I wrote what I’m pretty sure are the first few pars of this robodebt piece on my phone. It seems very clear in my mind. Also you can see my heart rate at the start where I did 15 minutes of stairs lol.

Alright, we are back from the long break. Justin Greggery KC is still questioning DSS Principal Lawyer Anne Pulford. Now moving on to the ombudsman inquiries and advice she gave in that context.

13 January 2017 email from principal lawyer Melanie Metz: "There have been a number of urgent requests for advice on Centrelink debt this week. Ronan and I have handled it."

Why the urgency? Greggery asks if she remembers a significant media interest in Robodebt such that ministers were appearing on TV and radio to justify the existence o the scheme.

The list of advice requested re: Robodebt is voluminous. We're talking about garnishee notices, the recovery fee, the new interest charge scheme and on and on and on. In short: remember all those things we did? Were we right to do them??

16 January 2017, Pulford returns form leave and emails Melanie Metz copying her deputy chief counsel re: smoothing income for debt. "On the basis we can make an argument to support the position discussed." Do you know what that was about?

This involves a conversation with DSS branch manager Emma Kate McGuirk, referenced in that email. Do you recall the conversation? "The gist was... Emma Kate wanted to discuss a particular circumstance where smoothed income was the only income available to a decision-maker."

Greggery: "You'd address this topic in the 2014 advice."

Pulford disagrees, she says this is more narrow than in 2014. "In a circumstance where only smoothed income is available... is there any argument for a decision-maker proceeding to act on that."

So what we have here, it seems, is a branch manager saying, in my words: "we aren't going to do this any other way and you need to give us a legal argument that lets us justify this."

My computer just shut down without warning just as Greggery was asking Pulford if suddenly she was being asked to justify a scheme which in 2014 she said was unjustifiable.

"I don't believe I am saying the Robodebt scheme was justifiable, I don't recall it being raised in the discussion with Ms McGuirk, I believed I was answering a quite narrow and general question," Pulford says. Greggery asks how this could be given political and social blowback.

"There was an inconsistency between your earlier evidence about not having any recollection and your capacity to say that you don't believe the Robodebt scheme was raised, as a positive assertion." Pulford agrees there is an inconsistency.

Basically, you can't recall when we need you to recall but when you need to recall something you get to recall it. How interesting.

Greggery: "Did you feel pressure from within the Department, particularly Ms McGuirk, to come up with the basis on which you should change your 2014 advice that the scheme generally was not legally defensible." Pulford pauses for a Very Long Time. This is big.

And here we have her answer: "I believe I felt pressure from Ms McGurk to provide an answer that justified taking action in circumstances which the broad general advice in 2014 would not have supported on its face."

Pulford emails Melanie Metz, cc-ing her deputy chief counsel, says she has opened up a new advice because "this issue" was not previously canvassed. Metz replies: "That's fine with me, Anne."

18 Jan 2017, Ms McGuirk emails Pulford. "As discussed, I am looking for advice for a last resort method of debt identification for income support recipients." Greggery says this question is just a rehash of the 2014 question about whether smoothing income is legally defensible.

Pulford does not agree with that characterisation. Says again that it is about a particular circumstance. But Pulford then concedes the "available information" here is... smoothed income from the ATO. Which in 2014 Pulford said would be inaccurate.

So what's the difference, Greggery asks, between the questions? "There is a difference in terms of having no other income available which implies a more active investigation by an officer of an individual's circumstances before looking at the smoothed income."

But legally, Greggery says, the absence of evidence does not amount to positive proof of a debt, correct? The pause here is 7 seconds or so. "Perhaps the advice I ultimately provided takes a different perspective on the question of whether that accurately determines the debt."

Last email in sequence from Louise Macleod the acting senior assistant ombudsman. She says "during the course of our investigation we've identified an issue we need to raise with DSS. It concerns the authority for averaging employee income across a full or part financial year."

Pulford is copied on this which means she understands at least at this point that there is a live ombudsman inquiry. Pulford concedes there is an attempt to "very finely" read the ombudsman's request as to "carve out" the 2014 advice. To hide it, basically.

The Department of Social Services actively withheld the 2014 legal advice which said Robodebt is NOT LEGAL from the Commonwealth Ombudsman.

Pulford intervenes to suggest that both the 2014 and 2017 advice should be forwarded to the ombudsman, a discussion ensues about how the apparent inconsistencies can be explained.

This is accepted by the director of the debt and compliance team at DSS which then necessitates the creation of an "adjoining" paragraph to be given to the ombudsman which explains the apparent discrepancies between the 2014 and 2017 advice.

CORRECTING THE ABOVE: actively SOUGHT to withhold. It was the original position, eventually overruled.

Greggery says if you arrived at a decision that a social security payment had been overpaid based on smoothing you'd be guessing, wouldn't you? Pulford: "You would have to be making a decision on less than complete information." Definition of guessing?

Greggery: "This was the most hypothetical advice that could be provided to legally justify some aspect of the scheme then in existence." It had no practical application at all, surely, he says. Pulford says she wouldn't agree it had NO practical application.

Greggery: "You must have understood that you were being asked to walk back the clear terms of the 2014 advice in the context of what was happening in the public arena with the Robodebt scheme." Pulford pauses and says "as I said I don't recall."

Emma Macleod (acting senior assistant ombudsman) email acknowledges that the ombudsman was provided with the executive minute by DHS, DHS saying advice was sought from DSS in the proposal. The ombudsman is writing to request that advice for the investigation.

Holy shit. Pulford, in another email to DSS director of debt and compliance (which Greggery suggests is really a "rehearsal of a position") notes that the 2014 advice was not, at that point, provided to the ombudsman and if that were the case the decision came from Serena Wilson.

Was the 2014 advice ever provided to the ombudsman? Pulford doesn't know. "I don't recall whether or not I followed up," she says. Was she aware that DSS was relying on the April 2017 Ombudsman report as "a validation of the Robodebt scheme"? No memory of that, she says.

Anna Fredericks, lawyer in Pulford's team, notes external legal advice from Clayton Utz was sought relating to an AAT appeal in 2018 by a Mr Earl. The advice is: "In our view the social security act in its present form does not allow the DSS..." to robodebt someone.

When Clayton fucking Utz ain't having it....

"We are happy to discuss the draft advice prior to finalising it," Clayton Utz says, in an email to Anna Fredericks. She says "the advice is somewhat unhelpful if the mechanism is something the dept wants to continue to rely on."

"[Clayton Utz] advise that they might be able to rework the advice subtly, if this causes catastrophic issues for us, but that there is not a lot of room for them to do so," Anna Fredericks says. Fuck me dead. External legal advice in 2017 which DSS had, two years before SG.

Pulford notes there is "limited room to adjust the outcome" and notes to then director of debt and compliance at DSS that if they accept this advice "that would mean the end of the Robodebt scheme."

This is so incredibly fucked up.

Pulford is asked by Greggery, getting frustrated: do you remember anything at all about Robodebt? Did you not remember that through each of these years throughout 2015, 16, 17, 18, 19, 20 that there was a significant issue in respect to the lawfulness of the robodebt scheme?

Pulford, helpfully, has no recollection of whether they discussed - despite her emailing asking 'what do we want to do with this advice' - paying Clayton Utz for their troubles and walking away. There MUST have been a discussion? "I don't recall if there was or not," she says.

Was invoice for C-Utz ever paid? Yes. Was the advice ever converted from draft to final? "The information I have seen indicates that it was not converted to final," Pulford says. So essentially, it seems DSS thought 'fuck this, no' paid the bill and pretended it never happened.

"Where is the line between losing something and active concealment, in your mind," Greggery asks Pulford. Her counsel objects.

"Why isn't it extraordinary that this advice was not finalised?" Greggery asks. Well that's because it happens all the time, Pulford says. Greggery: "If the advice is not finalised is it treated as not being given?" Sort of, yes. It is treated as not representing the dept.

"It has happened many times that I have seen it," Pulford says.

Commissioner Holmes: "I'm appalled."

The Commonwealth doesn't have any questions for Ms Pulford which is the shock of the century.

Adjourned for 5 minutes while Pulford's counsel consults with her on something or other.

We back. Pulford's counsel asking questions of her now. She was receiving treatment for an undisclosed medical condition which apparently affected her ability to follow current affairs at the time.

There is a non-publication order on what exactly this medical condition is.

Callan O'Neill, counsel for Pulford, asking a series of Qs which highlight that the legal team are expected to "influence department areas to take heed of advice" but are not responsible for policy decisions. They are to find "constructive ways" of allowing things to happen.

Pulford concedes there are "relatively few" times, going by the 2017 advice, where a decision-maker could take any action. Reiterates that it was very, very, very narrow advice. And with that, she is excused.

Oh next witness is Emma Kate McGuirk, who Pulford suggested was one person applying some pressure to deliver a certain kind of advice.

Like Pulford, McGuirk is still with DSS. She is currently group manager with the department (Redress Group).

Acting in group manager position with compliance team reporting to her for about 5 weeks which is the sum total of her involvement in the Robodebt scheme barring a conversation in 2014 when she was at DHS when she mentioned the fortnightly income test would be "central" in debts.

Now December 2016, she is acting group manager of the payments policy group in DSS for a period of three weeks. McGuirk notes she received a 5 January 2017 email from Ian Joyce (forwarding email from David Mason to Andrew Whitecross). Then teleconference on 15 January.

That was a Sunday, McGuirk says. "The reason I was acting was because my dep sec, Serena Wilson, was on leave and Cath Halbert was filling in for her and I was filling in for Ms Halbert." On the Monday, there was a meeting regarding the ombudsman report. Teleconf to brief Wilson.

Melisa Golightly, Karen Harfield, Scott Britton from DHS, Serena Wilson, Cath Halbert, Paul McBride, McGuirk, and Murray Kimber (DSS) were all present on teleconf. This was an update about the online compliance intervention program, how it was being implemented.

I'm having a little flashback to this: thesaturdaypaper.com.au/news/politics/…

McGuirk notes from meeting: this was not income smoothing but using info "when none other avail." 1.6 per cent of people are appealing. "Some media conflation of issues, student debt, FTB, age pension." Notes 60 per cent are "ex-recipient". In brackets - ex-recipients don't pay.

Bilateral Management Committee, one of the governance forums between DHS and DSS. An MoU between the two orgs about how the business of social security will be managed by DSS. She mentions a BMC meeting in her notes. No specific recollection of what was or wasn't confirmed.

McGuirk had seen David Mason's 2014 advice (remember, he's the one that said very early on: you should not do this, this will wreck us, this will cause damage). Did it come up on 15 January 2017? No reference or recollection .

Notes: Ombo meeting 16/1. Matt Roper, Steven Avery, Cath H, Serena, EK, Scott Britton, George Masry, Louise Macleod. Richard Glyn acting ombo. Briefing with DHS a week and a bit ago. Initial view of acting Ombo two-pronged: first report high level in February.

Later this week we will have clarity about what scope looks like. Keep up with DHS on enhancement to systems. Serena Wilson noted the budget process / request from govt. Complaints and cases in media, some confusion in press, Ombo agreed.

Ombo notes DHS defines complaints 'probably a little narrowly'. Concern people may not have documents.

Serena Wilson noted in the meeting "no change in approach to assessing debt" but a higher level of interventions. McGuirk's interpretation: "That would be change from the pilot program to the move to being fully online."

Someone from the ombudsman's office said in this meeting on the Monday "no issue over broad policy of debts to commonwealth being recovered." McGuirk thinks this was about the scope of the own-motion ombudsman inquiry, not about broader debt management policy.

McGuirk has a separate meeting with Scott Britton. Notes say: "Government didn't want burden to be on employers." Faaaaaaaaark me.

McGuirk doesn't know when she approached Anne Pulford re: advice. But did she raise the 2014 legal advice with the ombudsman in that meeting? "There is nothing in my notes and on this particular meeting I kept fairly comprehensive notes of what occurred and it's not raised."

Friday 13 January 2017 email. Subject: Action required, Secretary meeting with Kathryn Campbell. This is Finn Pratt (DSS) meeting with DHS secretary Kathryn Campbell in a few days. Email requested info regarding hot issues.

McGuirk says she was technically on leave but she cleared the dot points for the hot issues, provided 19 January 2019. "Senior dept staff given a runthrough... and are comfortable that the current process is lawful and clear." Staff included McGuirk. Were they shown 2014 advice?

McGuirk requested additional advice from Pulford. Does she recall saying words to effect that there is a "departmental business need" to have legal advice justifying taking action? "I have no recollection of a particular conversation where I gave Ms Pulford verbal instructions."

But given the subsequent email, McGuirk accepts that she did have a verbal conversation with Pulford.

McGuirk: "The 2014 advice that had been provided to Human Services was very much focused on the fortnightly averaging concept. We understood... that (DHS) had not amended the way that income was assessed and debts were raised. So they had essentially taken on board that advice."

Commissioner Holmes: "I'm a bit confused, sorry. The 2014 advice said averaging probably didn't comply with the Act."

McGuirk: "Broadly. We understood they had taken that advice on board."

Commissioner: "What did you think they were doing?"

McGuirk: "I was new to this."

McGuirk and Cath Halbert, also new to this, understood that DHS had not changed the way they calculated debts. This is her contention. That "debts were calculated from various information sources about where income was earned."

Commissioner: "So this was news to you?"

McGuirk says she thought the averaging was being used as a trigger (a red flag) to identify where there ~might~ be an overpayment of social security.

That obviously changes when DHS apparently divulge info that they do use income averaging / smoothing but only "as a last resort." Was the 2014 advice provided to the Ombudsman, in the end? McGuirk now understands that it was. PHEW.

Argh, I gotta run to record a thing which is not ideal but they're almost done for the day anyhow. Oh wait, they're done now.

DAY FOUR of the Robodebt royal commission is back. Cameron Brown
former Director of Payment Integrity and Debt Management
Department of Social Services is on the stand now. I'm just finishing a (currently) 3000 word feature on this but will try and tweet along.

Cameron Brown says he has searched everywhere and can find no evidence that the very first concept of Robodebt was ever in writing. But it was "certainly not a new policy proposal" at that stage. It was a thought bubble, in other words, raised by DHS with DSS.

"Almost immediately... we identified that there was really no way of taking an annualised figure and to smooth the income without further investigation into what their fortnightly income actually was. It was very clear ... that it was not supported by the legislation."

Cameron Brown notes that he had concerns not just about the lawful basis of the proposal but the ethical basis. "A lot of the individuals that would end up receiving these notices... the onus of proof would be a level of proof they simply would not be able to substantiate."

"Unemployed people are, almost by definition, they have vulnerable cohorts within them. There would be people who would enter into agreements to repay debts which they had not incurred in the first place. And I felt that that practice, as a result, would be unethical."

Short adjournment to attend to some apparently missing documents or confusion or something hell I don't know I was eating some trail mix.

Cameron Brown being asked about some instant messages (from Skype) from Mark Jones about whether they need to go to the AGS (Australian Government Solicitor) but you wouldn't do that until you go to your internal legal areas.

This conversation record. Jones writes on 27 Oct 2014: "Cameron, with this legal advice do you think there may be a case to going to AGS? The [issue] is I believe we have to ask for AGS input."

Cameron Brown: "I would note at this point in time there is no NPP (new policy proposal), in a sense, no formal product. So we actually don't really have anything to go to AGS about." This project was an idea with no real status, he says.

Brown writes back to Jones on 27 Oct: "Let's see what they say... I suspect if it is not black and white then we may need to go to AGS."

Brown says legal advice they got was definitive and he would have expected that would have been the end of the matter. If not, there would have been legislative reform if there was a strong desire. And by that he means from the MO. Slight dig at DHS here: MO aren't yet involved.

To read between the lines there: what the fuck were DHS doing pushing this thing after very clear legal advice when they haven't even told the MO yet?

Email being shown from Murray Kimber (branch manager) to Brown and others, including DSS Dep Sec Serena Wilson. "We expect legal advice in coming days to confirm that it is not appropriate under current provisions and would not be expected to hold up to scrutiny or challenge."

Kimber says they will now take it off the table and tell DHS when the final advice comes in. A "Plan B" mentioned by Murray Kimber here is that instead of going forward with income smoothing proposal they could go after high value debts instead.

Brown has provided docs that he says provides context as to "why DHS are starting to come up with new and sort of, quite outlier, ideas." One is a bar chart that shows in 2010-11 to 2013-14 that the total debt pool is fast outpacing the growth of debt recovered.

Final significant email from Cameron Brown before he left DSS was to Mark Jones, essentially saying that once you get the legal advice (2014) make sure you or DSS talk to DHS and "close the loop."

Cameron Brown is done. Commission adjourned until 11.50am AEST

Back now with Lisa Keeling, former General Counsel, Programme Advice and Privacy Department of Social Services.

Keeling is asked about a review she was asked to do regarding "why legal advice was not obtained about using Australian Taxation Office Pay As You Go income data in the program to raise and recover debts." Of course, there was legal advice as we know.

I was doing some edits but it seems nobody bothered to tell Keeling, tasked with answering that question, that THERE WAS LEGAL ADVICE. In her review, then, Keeling wrote: "It does not appear that there was a conscious decision not to obtain legal advice," part of the review says.

"It also appears that any risks perceived with using ATO PAYG data... was offset by the view the appeals process would mitigate any debts raised incorrectly as a result." This view was based on her review of the documents, Keeling says.

Basically: if we're wrong, let them appeal. As if that somehow makes it OK! The appeal is work, the appeal is uncertain, the appeal is - ask anyone on the NDIS - a cruelty in and of itself.

8 January 2015 request for advice. "This request did not expressly refer to how the assessment outcome would be applied," Keeling says in her review. In essence, Keeling concluded the same re: April 2015 advice. May 2015 advice also the same. Keeling agrees re: her conclusions.

Now, regarding 2014 advice, Keeling says, in her report, that "there is no evidence that DSS shared this advice with the department (DHS) at any point prior to the implementation of the program." And how did she reach this conclusion? An email.

26 Nov 2019 email to Tim French: "Tim, I don't think that either the 2014 advice or the 2017 advice I provided you was shared directly ... however, both advices seem to have been provided to the ombudsman in early 2017 as part of the Ombudsman own motion review."

"Legal Services also understood that income averaging was a well established practice and that the business area must have therefore already obtained legal advice on the use of averaging," Keeling says in her review.

Tim French to secretary's office, cc-ing Keeling 13 December 2019 (sending Keeling's report). The Secretary of DSS replies: "Noted, may not be necessary to finalise the report but this work will be useful if a report on this matter is later required." And was it finalised? No.

On the theme of yesterday's Clayton Utz draft advice which was so unhelpful it was left in draft form. Keeling says she is aware this practice happens, for many reasons including that the advice offered was "unhelpful."

Commissioner Holmes: "But if you've gotten advice even if it's in draft form, it's legal advice, it's come from lawyers, it's paid for, it exists. It's like a child putting its hands over its eyes."

Keeling: "I agree with you."

And that's her finished on stand for now.

Commissioner now ruling on Public Interest Immunity claim on 21 documents (on the basis that they are cabinet documents). Most of these documents are Category 2 (docs not considered by cabinet but which reveal content of other cabinet documents).

Commissioner Holmes says there was a chain of documents that ultimately formed proposals in a brief that went to minister. “So fundamental to the inquiry and thinking of people behind the scheme” the public interest required them to be produced.

This has all been heavily foreshadowed, by the way. Basically the public got most of what it needed, including the executive briefings and some documents with minimal redactions. 11/21 produced. Commissioner’s test was whether public interest was sufficiently great.

Adjourned until 2.15pm AEST

We are back from lunch. Jeremy Hirschhorn, Second Commissioner, Client Engagement Group Australian Taxation Office is now on the stand. Big title.

Client Engagement Group covers all taxpayer groups. Responsible for compliance, Smarter Data specialist group (data and analytics). Before being appointed here, he was deputy commissioner and before that chief tax counsel.

Jeremy Hirschhorn is being asked about this practice of being given draft advice from lawyers, internal or external, not being converted to final. He says he is aware of this happening but is unaware of a draft unfavourable advice not being made final.

I have a page proof back for work so I am trying to check that and also half listen to this, so might be a bit slow here.

Hirshhorn says the default position at the ATO is that taxation data is secret and not shared with anybody. But of course, there are some obligations to share data created by legislation such as via the Data Matching Act which is more permissive around use of Tax File Numbers.

Hirschhorn says the data ATO provided to DHS was annual data, because "that is all we need to collect" and it is not provided in any other format other than annually. As in, they don't average it for DHS and hand it over.

There were standing consultative forums (high level, strategic) and data management forum (lower executive / assistant commissioner level) between ATO and DHS regarding these arrangements on data. Meetings monthly or quarterly. On a number of occasions, Robodebt was discussed.

3 March 2015 email, received by Assistant Commissioner Alistair Kemp at ATO from Jason Ryman (DHS). Ryman seeks "external costing request for compliance measure." Ryman has to seek ATO input on what it would cost. This is the first contact ATO has identified on this matter.

Basically this means that DHS has an idea about a policy which would have an effect on the ATO in terms of cost, so they have to go to them with an External Costing Request". It's a protocol in the APS basically when other agencies are affected.

A new email, from Ben Lumley at DHS addressed to people in the ATO. "DMP Replacement Project" is the subject heading. DMP is "data-matching plan/program". Email indicates "DHS is currently scoping a project to replace data-matching between Centrelink and the ATO."

According to DHS, the Data Matching Program Act imposed restrictive requirements and in the "current compliance environment [DHS] it is considered to have too many restrictions to be able to adequately service our customers and mitigate payment risk."

New email from Lumley at DHS to Michael Brown at ATO. Brown requested more detail, had asked why DHS proposed to change arrangements.

Lumley explains under subheads. "DHS legal services given preliminary advice stating there is no legislative imperative to continue to conduct data matching under the DMP act, except for tabling a report to parliament." Hirschhorn says ATO has no evidence of advice being provided

Lumley also explained to ATO: "DHS currently conducts significant data matching activities not covered by the DMP Act, which is conducted in a far more efficient manner." Hirschhorn has no idea what Lumley was on about in that email.

Oh here we go, one of the limitations in the Data Matching Program Act was time limits on the use of data! And we know DHS through Robodebt was asking for data from the ATO as far back as 2010-2011 which would not have been allowed by the DMP Act.

How kind of DHS, they wanted to identify people earlier to catch potential before it got too big. Kindness knows no bounds, not even the DMP.

catch potential debt*

Does a debt that never existed grow faster than a debt that did exist? There's a thorny philosophical question for your Thursday afternoon.

Now to 23 April 2015. Meeting minutes from the management forum between ATO and DHS. The new policy proposal for Robodebt is mentioned here. Agenda Item 4: ATO-DHS data exchange optimisation and management plan. Scott Britton (DHS) and Tyson Fawcett (ATO) presented to higher-ups.

Hirschhorn's interpretation of this agenda item is that this does not refer to Robodebt. But previous information exchanges. Now to Agenda Item 6, which is related to Robodebt. DHS again mentions restrictions and costs under the DMP Act and advocates moving away from Act.

Once again, DHS mentions its legal advice and ATO has never been able to find any draft or final advice or any reference to it in their own systems.

Skipping forward toward the end of 2015. Email from ATO's Fawcett to Ben Lumley at DHS (13 Nov) returns to the external costing request re: new policy proposal to replace the existing process under the data-matching program.

That was sent 1pm-ish on that afternoon. Another, sent around 7pm that night from Lumley (DHS) to Megan Clarke at the ATO and others. It has email trail which notes: "Timing for costing is tight because they are to be provided to Finance on 16 November for agreement by Tuesday."

Email from ATO back to DHS Lumley seeking 7 categories of information for the purposes of the costing. Questions: what is the proposal, its intent, background, start date, business driver, how will it change the process, the type of data, frequency etc

Response.
What is proposal? Protection of the integrity of government outlays is a key objective. This is a four-year proposal due to commence 1 July 2016 (budget measure) identified and how the approach would operate would be for an additional 460,000 compliance interventions.

The intention was to get the same data it always received from the ATO but to get it from outside the Data Matching Program Act so that DHS could "significantly increase" the compliance activity. Hirschhorn agrees that it appears to be a significant increase in the program.

Phone rang missed some stuff. Don't answer your phone ever!

Hirschhorn is not aware of any reference to any legal advice other than internal ATO advice which was re: data and basically said general exemptions under taxation secrecy laws was enough to share same data, but without tax file numbers (?) Never saw any of the DSS advice.

4 Feb 2016. Another email trail! More legal advice re: tax file numbers. DHS was insisting on supplying tax file numbers to the ATO, which is not allowed outside of the Data Matching Act, Robodebt starts on 1 July 2016 and they still figuring this shit out / not getting it.

This is about Identity Matching, which tax file numbers were used to facilitate under the bulk data exchange. This was what they always did under the Data Matching Program Act. But if DHS wanted out of that, to free themselves up elsewhere, then they shouldn't be using TFNs.

Proposed tweak. Michael Brown (ATO) is the data-matching gatekeeper suggests: "If the activity is taken outside the Act then the normal [secrecy] provisions prevail." Brown says a different set of data can be used to generate an Identity Match.

Lengthy email! Title of email is "legal basis for sharing data with the ATO". Ben Lumley, DHS, sending request within his department before forwarding the email trail. Key driver was to "dispel or confirm views regarding what we could and couldn't share and for what reasons."

25 Feb 2016, advice provided, is sent to the ATO. Greggery KC says the "ultimate conclusion" is: "disclosure of the tax file number was said to be permissible." This is advice settled by DHS. The ATO does not agree that this advice is actually correct, once they see it.

ATO lawyers, emailing in house: "What are the next steps where DHS is saying one thing but our guys are saying another thing regarding the TFN issue. This is a good win for us, if it's valid, but not sure how to deal with the difference of opinion here."

Long story short: tax file numbers were not shared under the Robodebt scheme.

This thing was being built on the run by people who saw dollar signs and thought 'fuck it, we'll figure the rest out later' except they never really figured out the most important aspect which was: are we allowed, at all, to do this? (No)

DHS was insistent they have data in early September (Robodebt started 1 July 2016) so they could start analysing the data. They kept mentioning these tight timeframes to DSS, as we know, and certainly to the ATO. Hurry hurry, don't look etc. Adjourned for today. Back tomorrow.

I should clarify: they absolutely did figure that out, and had all the legal advice, but they never changed the legislation and they never amended a single element of the thought bubble in view of the legal warnings that said “you can’t do this”

Back for DAY FIVE with ATO's Jeremy Hirschhorn, being shown an email from 25 May 2016 (advice from ATO legal) which essentially says the disclosure of identifying information to another agency can be done for the purposes of the administration social security law.

Email: ATO needs to start extracting data to meet DHS timelines which are already "critical." ATO's IT function pressing to start this immediately after the senior executive level meeting between DHS and ATO on Friday 22 April 2016. Hirschhorn not sure when this did happen.

More advice about more granular data being sent to DHS than what is currently being sent. DHS had previously told ATO that it didn't need to know some fields of data for the purpose of administering the social security act.

Greggery KC: "How was it that, from the ATO perspective, the ATO satisfied itself the protected identity information was for that purpose [administering social security]? As in, what steps did the ATO take to you knowledge?" Hirschhorn not sure.

Greggery asks again. Once we're outside the DMP Act and we are subject to the voluntary data-matching guideline, someone had to be sure that the data being bulk extracted for DHS was for the purpose of administering social security law. So who made that call? We don't know.

"There is a question to be answered about whether it is relevant for the purpose of administering a law which would require, presumably, both legal and factual elements," Jeremy Hirschhorn says.

"Generally we would rely on the other agency for the operation of their law," Hirschhorn says. Basically, the honesty box approach. Bearing in mind we are only five weeks out from the start of Robodebt on 1 July 2016.

Greggery asks "if the ATO, in May 2016, was informed by DSS that it had internal advice which didn't support the use proposed by DHS of the data, what would be the ATO response to the provision of data?" Hirschhorn: "If we were aware... we could not provide the data."

Boom.

Hirschhorn: "We were not aware of those legal advices. We would be very worried we would be breaching the Tax Administration Act."

Greggery notes, somewhat deadpan, that it is of course a "reasonable assumption" that another agency is acting within the law. That's what Hirschhorn says was ATO's assumption, but cannot find anything they had that would have validated that assumption at the time.

30 November 2016. Michael Brown email note to Ben Lumley at DHS stating the ATO has "noticed a spike in complaints being received by the ATO due to DHS compliance activities."

Another email also on 30 November re: ATO that "there seems to be some systemic issues with the way DHS is utilising ATO data" and a meeting has been set up to discuss this and other complaints. Meeting with Ben Lumley.

Hirschhorn says he understands a couple of these issues: identity matching, and by moving away from TFNs to a name/address type identity matching "there were some issues where a person's income was attributed often to a family member."

Small number of people affected by these types of issues. The issue is "how the DHS is representing the strength of the ATO data in its correspondence with individuals." Basically: not being honest about how accurate it is.

20 December 2016 conversation between ATO internals. Few articles cited there, one looks like @lukehgomes

This is wild. ATO notes in this email that "DHS appear to be attaching the income details to their client record without further validation and undertaking discrepancy matching." Then when people rang the DHS to complain they were told that they needed to take it up with ATO!

Michael Brown ATO emails Ben Lumley at DHS. The media attention has tax office spooked and Brown notes to Lumley "our SES are questioning whether the ATO has any exposure." Essentially, what's going on, are WE on the hook for whatever this is?

6 January 2017 from within ATO that notes "we are highly exposed as the matching agency."

Hirschhorn not sure the document from which that assessment came was something the ATO had any contribution.

DHS asserts that the ATO data is being used for compliance purposes. Greggery: "How do you know, how does the ATO satisfy itself In the context of a bulk data release, which would otherwise be involved the commission of offences, on a large scale" that this compliance was lawful?

"The precise way in which they were using the data was not known by the tax office," Hirschhorn says. "We did not ask for the specific ways in which they were administering their compliance program." Do you check it's lawful? "No we don't."

Centrelink briefing document 12 Jan 2017. The trail begins 21 Dec 2016 and continues into January.

Crikey article Sally Whyte about "how to dispute a Centrelink debt." Hirschhorn says it is obvious officers were "closely monitoring the press."

3 January 2017 email with some briefing points. Notes that DHS has chosen to "step outside the DMP Act for administrative convenience" and advises that DHS do no further identity checks and they are "averaging income over entire financial years."

Same email: "I have been dealing with DHS/Centrelink issues in relation to this for the past month or so (IGT queries, complaints, ministerials, FOI requests... the list goes on." IGT is the Inspector-General of Taxation.

Hirschhorn: "The data we were providing was annual data. It was data that was fit for the purpose of identifying the potential for discrepancies. My personal opinion is the data is not fit for purpose for a definitive allocation to fortnights."

ATO had a meeting on 14 December 2016 with DHS and there was a verbal assurances that they would take care of it. No written assurances by early January.

So also in January 2017, the Commissioner of Taxation gets wind of all these issues and asks for a briefing to be prepared. Briefing paper is being discussed now.

The briefing paper notes this is "not a new program" and has been used for 25 years (the sharing of ATO data with DHS). It notes that from 1 July 2016 (Robodebt) DHS has largely automated the discrepancy matching program / correspondence without human oversight.

7 February 2017 meeting! DHS deputy secretary Malisa Golightly will hold a "debrief" for people at ATO regarding any further DHS plans that might impact the ATO.

7 Feb 2017 email from Michael Ingersoll, assistant commr at the ATO. Recapping Malisa Golightly's debrief. Malisa Golightly told the ATO, according to this, that nothing has changed, press reports about the use of income averaging are wrong because they had "never done that".

Sorry,Golightly said they had never used income averaging "as routine" and don't do it now except where a client doesn't provide any info. Also told ATO the way they use this information from the tax office to determine welfare payments has also not changed. Just not true.

Hirschhorn: "From the notes of that meeting all officers assumed that what they were told was accurate."

Adjourned until 11.50am AEST

I know we haven’t heard from DHS yet in this inquiry but things are, how you say, not looking good for them at this point

7 July 2017 email from Tyson Fawcett in the ATO to DHS says there has been an operational meeting and they want further assurances that ATO data will be used properly and, if not, "that you cease and desist the usage of the data until we have your assurances."

Greggery: "Level of concern [where] an officer of the ATO asks DHS to cease and desist in its use [must] have derived from the potential exposure to the unauthorised disclosure of data for a particular purpose, which was not in fact, the administration of Social Security Law."

Greggery: "It is the strongest phrase we have seen from all of the material gathered by the ATO to date."

DHS responds and says a data management forum will take place on 20 July 2017. "There are currently a range of measures the government has asked us to deliver which rely on data matching capabilities of our organisations and this work needs to continue."

This was pushback, and quite firm, and hints at potential "political leverage" Greggery says that has been exerted.

This is good stuff, but sadly I have to bow out for the day. Follow @DarrenODonovan for a beautiful turn of phrase.

WRAP of week one here at the link: thesaturdaypaper.com.au/news/politics/…

Are you ready for DAY SIX of the Robodebt Royal Commission? We are getting some very senior people this week, including former secretaries of DSS and DHS Finn Pratt and Kathryn Campbell. And this is what week one gave us so you strap in. thesaturdaypaper.com.au/news/politics/…

Matthew Flavel, Deputy Secretary, Social Security, Department of Social Services is being sworn in now.

Flavel moved across to DSS in January 2020. From 2003 until then he was with Treasury. He's a newcomer to DSS, then. But did he have any involvement with Robodebt when at Treasury? "No I didn't," he says. He was division head of the budget policy team from 2015-16 onwards.

But says he would only have been broadly aware of any particular policy measure, and nothing more than that.

Flavel, because he is new at DSS, is going largely by what he has been able to find out from documents. He is being asked by what method he searched for these documents / had them discovered for the Royal Commission. Also relied on individuals in DSS at the time.

We have an ongoing issue where witnesses or people conducting searches have not been given access to or asked for access to secure email servers controlled by DSS. Flavel can't say for sure secure email servers were searched. Commonwealth has been (slowly) arranging access.

31,000 documents, but still without secure emails Commissioner Holmes asks: "So essentially, the statement we got from you may be based on some relatively small proportion of the actual DHS [she meant DSS] material for all you know? You don't know what you didn't see."

Flavel says that is correct. Greggery KC says one of the requirements to provide a statement was to refer to documents already produced to the Royal Commission. Justin Greggery, senior counsel assisting RC, doesn't see any reference to these documents by Doc ID as required.

DSS either not great at reading comprehension or deliberately being obstructive here. Pick one.

"You see it's not very helpful because you make assertions about a state of affairs but you give no supporting documentation, so there's no way of the Commission looking at what you were looking at to see why you say things," Commissioner Holmes says, frustrated.

"I find it really hard to understand how you could think that this would be useful," Commissioner Holmes says. Flavel says "with apologies I relied on others" in preparing this statement. Fair to say she is pissed now.

"Were you not taking the Royal Commission seriously? I just don't understand this," Holmes says.

Greggery: "How is it that you were selected as the proper officer to respond to the notice of the Royal Commission?" Basically, because Flavel and whoever helped him put his statement together didn't follow RC notice, we are wasting a fuckload of time here trying to cross-check.

Flavel says this would have ultimately been a decision of the Secretary of DSS.

Why not Andrew Whitecross? Commissioner Holmes: "Is there any burning reason he couldn't have undertaken this activity [responding to Royal Commission]?" Flavel says it may come down to a "technicality" because Whitecross is an officer of DSS but has been seconded elsewhere.

Flavel says he discussed all this with Whitecross but it was only via email! Fuck me dead. Whitecross is one of the senior names that came up multiple times last week in evidence at the RC.

Flavel says there was a general request for officers to "check their own emails" for any documents that may be relevant. Flavel says he emailed people individually. This all seems pretty amateur hour doesn't it, unless something else is going on.

Greggery: "And everyone to whom you sent that request replied that they didn't have anything to add?"

Flavel: "Nothing to add or no other information that they found relevant."

Greggery: "Do you appreciate that there might be a deficiency in that response?"

I mean, are you kidding me with this shit. "It was an additional layer," Flavel says, in finding documents, "designed to ensure we had made maximum enquiries."

Greggery points out that the people Flavel asked for documents did NOT know what documents had already been produced to the Royal Commission but all of them (excl. Whitecross) said they had nothing further to add. But how could they have known?

Did that strike you as odd, Greggery asks, that people who were deeply involved at some point in Robodebt couldn't find any emails or documents relevant to an inquiry about Robodebt?

"No it did not strike me as odd," Flavel says.

permission to treat the witness as facile

Flavel was asked to describe the governance arrangements by DSS re: early Robodebt iterations. In statement, he refers to a bilateral management arrangement with DHS with an effective date of 22 October 2014. Varied March 2016 and April 2018.

Flavel, in his statement, says he is "unable to comment on the degree to which the bilateral management agreement or the payment assurance service arrangement was adhered to in respect of either of the first two iterations of the robot debt scheme."

Flavel, when asked, says there was no direct link between the agreements and Robodebt. Despite including it as a relevant governance structure when asked to describe such structures for the RC. "I would say relevant without it being fundamental," Flavel says.

Greggery KC: "So in terms of any governance arrangements which would capture the robodebt scheme, this is as good as it gets?"

Flavel says he wouldn't say that it was just additional context (???).

Greggery: "Does that mean there is no record of any governance structure?" Yes.

Flavel, spitballing here, suggests the "relationships between the Department of the Secretary of the Department of Social Services and the Secretary of the Department of Human Services would also be, I think, considered to be part of the governance arrangements."

But, lo, he did not find any documents or letters or emails that might indicate that there was such a relationship. Greggery: "Did you find any record of correspondence in any form between the two of them that mentioned Robodebt?" No, Flavel says.

Flavel: "It may well have been the case that there were discussions taking place via telephone, that would not have been documented."

Not committed to writing at all, at any point? Correct. "That surely must strike you as odd."

Bilateral Management head agreement signed by Kathryn Campbell (DHS) and Finn Pratt (DSS) being shown now. Greggery: "The arrangement captured the policy and legal advice obtained by the DSS in November and December of 2014." Flavel: "I'm not sure to what extent it captured it."

Greggery: "And although you say it was not legally enforceable, it was plainly a document which both secretaries intended would regulate the arrangements between the department."

Flavel: "I would probably use the word codify."

Greggery: "Codify."

So didn't the Nov and Dec 2014 policy and legal advice re: Robodebt relate directly to the paragraph of the bilateral agreement that says both departments will take steps to ensure compliance with legislation. Do you agree with that? Flavel, confused, eventually says yes.

Greggery: "DSS could only perform its obligations under the bilateral management arrangement by sharing the policy and legal advice with DHS in November and December 2014, correct?"

Flavel: "Correct."

DSS

Oh, Flavel thinks that it was Cath Halbert acting for dep sec Serena Wilson (on leave) who emailed Malisa Golightly at DHS to let them know they had policy and legal concerns re: Robodebt policy idea. This was January 2015.

Flavel: "I've not seen a response [from DHS] other than Ms Golightly who said 'thanks we will discuss or consider further'."

Greggery: "And then the trail goes cold."

Flavel says it essentially does. "It's really when you get to late March 2015 when the policy is actually formally a policy proposal" that obligations kick in.

Greggery: "What may be surprising is that when DSS got specific advice which was against the proposal, it still went ahead. On your review of the documents, was DSS legal advice disregarded by DHS."

Bear in mind DHS sent a brief to Minister Morrison in Feb 2015.

Flavel: "In my view, it is less about the bilateral management arrangement and what advice was given to ministers from DSS, at the time that the decision was taken about legal and other risks that were attached to their proposal, and have not sourced documents to that effect."

"It is a mystery," Flavel says.

Argh hit send accidentally. Flavel says it "is a mystery" why it seems DSS let this all get to this point knowing what it did about the legal and policy risks from late 2014 and apparently not communicating this to a minister.

So at some point DSS shifted from "not at all satisfied" by legal compliance to somehow "satisfied" all because of a presentation given by DHS and Finn Pratt as secretary writes to Ombudsman saying everything is regal-legal. Flavel says that's a question best put to Pratt.

So minutes are recorded from the bilateral management committee meetings between DHS and DSS. Did any of these come up? Flavel says he checked for terms like robodebt and similar and nothing came up. Greggery: "Does that strike you as odd?"

Flavel says he suspects the BMC focuses more on implementation of policies, rather than policy development. But the guideline explicitly mentions "operational" matters and mitigation of risk. And still nothing mentioned at these meetings?

We are stuck in a pocket universe here. Flavel contends that because Robodebt was just a thought bubble, nothing was done that seriously reckoned with it, but by the time it made it into the budget these risks were not reckoned with because now it was operational.

Which is a bit like saying 'we didn't worry about it until it mattered and when it mattered we didn't have to worry about it'.

gonna go mad before the week is out

looooooooooot of committees and subsidiary committees and data committees and itty bitty committees but not a single minute from a single one appears to mention anything relating to Robodebt or its various iterations

Flavel: "There is no evidence of a piece of advice from DSS going to the Minister for Social Services identifying particular risks."

Flavel: "The critical issue is what was in front of ministers at the time the decision was taken. And what discussions actually happened in constructing the proposal." And you don't know any of those? Flavel says these would likely be cabinet documents.

Adjourned until 11.50am AEST

They have found the email Flavel thought he was talking about re: Cath Halbert telling Malisa Golightly about Robodebt issues, but the one they found in the break is not the one Flavel seems to remember. Might have been helpful if they had prepared his statement as required!

Commissioner Holmes says it is a "critical issue and I am very keen to see it." yes we would very much like to see it, MATTHEW.

Oh goodie, circling back to the Clayton Utz advice from August 2018. "What investigations did you make into what happened to that document once it was provided to DSS," Flavel is asked. Flavel recalls an email. But what documents did he identify re: taking of action?

Flavel: "I don't recall any emails that went to the taking of action, simply the receipt of the advice." This seems to be a running theme throughout this Royal Commission.

Greggery KC: "This is a case where the trail goes cold again after the receiving of significant legal advice?"

Greggery: "What possible explanation could there be from a departmental perspective about why nothing seemed to happen with that advice after it was received?"

Flavel: "I don't know."

According to the Legal Services Directions, section 10.8 (?), DSS was obliged to share the advice because it related to a matter of significance to a government program carried out by DHS.

DSS had some visibility of AAT decisions that referenced income averaging to calculate a debt. Standing Operational Statements between the two departments re: unfavourable "Tier 1" decisions at tribunal being shared. Any from 2017 referred? "I don't believe any were," Flavel says

So there was a bit of back and forth before this hearing about why Flavel was chosen by DSS as the proper officer to front questions for the Department today and the circumstances in which that happened. That is being tendered to evidence.

23 January 2015 draft email shown to Greggery while he is on his feet and "it refers to an attachment described as the revised new draft brief to minister Morrison dot doc" which may have led to February Exec Minute. Adjourned briefly to consider.

Not a draft email! Email with a draft brief. Get it together Rick.

There is a section of this royal commission hold music that almost sounds like Celine Dion’s “my heart will go on”, if you squint (aurally)

This email attachment is in fact a draft Executive Minute "some of the options listed in Attachment A would need legislative and or policy changes. The Department has consulted DSS on the proposals."

There are various drafts of this Executive Minute. One draft is in evidence (I recall seeing something similar) but perhaps not this draft? We are figuring this out.

Holmes: "You see, Mr Flavel, it's a pretty good illustration of why we need you to identify the documents you rely on so that we can actually see what they say and how much they say or how little they say."

Holmes seems to be concerned that the only document we have produced so far that goes to minister's offices identifies legal and policy concerns but that the advice, as far as we know, never made it to those same offices.

Flavel will be free from the stand just after this document is brought up. Commissioner Holmes deadpans in his direction: "That might cheer you up, Mr Flavel."

Another 5 mins or so, being adjourned again. Adjourney of a thousand miles starts with some simple prep.

Back from the break. Greggery: "No good news I'm afraid, Commissioner." No further questions for Flavel. But confirms there IS a draft brief reflecting DSS position to the Minister but it has been moderated somewhat so the wording in a previous version was stronger.

I am so confused. I think we found it??

Commissioner Holmes: "I don't suppose you can tell me what 'impact day' is?"

Greggery: "I can't assist."

Holmes, jokes: "You're counsel assisting, Mr Greggery."

Anyway because we have the doc, we do have more Qs for Flavel. The language has been "watered down" to change it from "proposal would have fundamental impacts on" to "significant impacts for" social security policy and legislation.

Greggery KC: "Have you been able to identify where the less confrontational language derived from?"

Flavel says no, he hasn't, but that matters less than the fact the changes are sent from a senior person in DSS to a senior person in DHS.

Greggery: This language change "had the effect or was designed to have the effect that the minister would be more inclined to give the proposal his approval as it reduced a potential hurdle of significance."

Flavel says it is still strongly worded.

This. Is. Fascinating.

Greggery: "And so this is the very first step in the process. And if it is identified at this point in time that the proposal requires legislative change, as a practical consequence, it's not going to make a May 2015 budget between February when this is drafted and May 2015."

Flavel considers the brief still strongly worded.

Greggery: "It's an indicator of a change in approach and who bears the burden of complying with the Social Security Law."

Flavel : "Yes."

Greggery: "Which the legislature might say something about?"

Flavel: "Yes."

Adjourned.

Sweet angels, we are back.

Next witness is Christopher Birrer,
Deputy Chief Executive Officer
Services Australia. Sworn in.

Another latecomer! Birrer transferred to work for Services Australia from Defence in August 2020.

Some 300,000 documents filed by Aus Govt Solicitor re: the class action but the royal commission goes beyond that. "Many hundreds of thousands more documents" were produced for this commission.

We are talking about "concepts that informed" the Robodebt proposal for the 2015-16 budget. Specifically, Scott Britton and Jason Ryman. They "led the work to seek government approval to implement the Robodebt scheme."

They are up tomorrow, at this stage.

What was identified in each of financial years from 2010/11, 2011/12 onwards etc. Birrer notes: "DHS undertook a range of data matching activities throughout those years with the Australian Taxation Office and had collected about 160,000 what are referred to as discrepancies."

Birrer correctly notes that the way things used to be done were "quite, sort of staff intensive processes" and the new regime was designed to be more efficient.

So we are talking about PAYG data matching, Birrer is asked under what legislative framework is that done. Birrer skips the Act and talks about the Office of the Information Commissioner protocol / guideline which was a big deal in evidence on Friday.

This is a May 2004 document with the Centrelink logo on it. Centrelink is now a master program within DHS. This voluntary guideline explicitly states this is NOT part of the program authorised by the Data-Matching Program Act 1990.

The PAYG data-matching worked like so: DHS prepared a client list of people on income support payments and also partners where a person had a partner. That information did not contain Tax File Numbers (which is the data-matching program act significance).

This info with names and dates of birth etc is then sent to ATO which "matches that against the information that employers provide them regarding what the employers are saying that they paid employees, as part of the PAYG reporting framework" and this is sent back to DHS.

It didn't include income tax returns (that was included under the Act, not the guideline). DHS received a significant volume of info from 2010 which seemed to have 860,000 discrepancies. We are getting at the seed of the motivation for Robodebt: a hint that money was owed.

Commissioner Holmes asks if Birrer has seen the emails from Mr [Ben] Lumley. Some, yes, he says. "There's a discussion in them about the disadvantages of the [data-matching] Act." Holmes is trying to get at what the sudden upheaval was all about in data-matching approaches.

Had to take a phone call, but Commissioner Holmes is still trying to get her head (understandably) around the different uses of the data-matching act vs the voluntary guideline. Is it a case of holding on to data for longer? That's part of it, which the Act didn't allow.

Commissioner Holmes: "If you don't keep the data, how are you going to say to the customer 'We know your employer X has said this'?"

Birrer: "I don't know that, Commissioner."

The protocol, I should clarify, has a clause that remaining ATO data needs to be deleted within 12-months of receipt.

Greggery pings Birrer on this: what you're saying effectively when you wrote to customers during the early Robodebt phase was the info "may have been received from the Australian Taxation Office years earlier, and held on the DHS system" along with 860,000 other "discrepancies."

Birrer: "There was a view from DHS that the approach would be that they [the letters issued during Robodebt to customers] would be an information request."

Greggery: "A deliberate choice... not to create a legal obligation."

Now looking at the May 2017 updated protocol which Greggery notes was revised after "various inquiries of a public nature." This protocol was updated as a result of "consultation" with the Office of the Information Commissioner. What was that about? Birrer says he doesn't know.

Greggery: "Do you understand that the reference to changes to DHS business processes, technological changes and other minor changes is a reference to the changes by which were brought about to enable the Robodebt scheme?"

Birrer not sure.

Crucially: This 2017 protocol removes the 2004 version's 12-month retention limit on ATO data. In other words, previously they were meant to dispose of the data within a year. This Robodebt-friendly version of May 2017 suddenly makes no mention of this.

Greggery: "Was it the intention, so far as you've been able to ascertain Mr. Birrer, of DHS to obtain the equivalent information that it would have obtained under the Data Matching Program Act under Table 3 from this protocol, except for the TFN?"

Birrer says not quite.

Commissioner Holmes notes, and Birrer agrees, that there is a missing sentence between different protocols. In 2004 it mentioned that Centrelink staff "will check the customer's record" to see if the discrepancy can be explained. This is not in the 2017 update.

Commissioner Holmes then adds that a "program that's ostensibly being conducted under the 2004 protocol, from 1 July 2016 to 20 May 2017 isn't, in fact, in accordance with that protocol."

Greggery: "To the extent that that suggests there was a manual component of staff checking the output of the matching in every case before the review commenced... that would be misleading."

Birrer: "If it was read in terms of every every data match, yes, it would be misleading."

Greggery: "Pre-Robodebt, the power to issue notices to employers was exercised routinely by Centrelink compliance officers. And that was because, to put it neutrally, that was not the best source of information for the manual review." Yes and yes.

Greggery: "The reviews in Pre-Robodebt period undertaken manually by compliance officers were conducted according to various standards that had been established within the department." Yes, and that included "acceptable documents for verifying income when investigating debts."

This is great. DHS direction to its own staff prior to Robodebt said you can use an annual figure to raise a debt BUT "if income varied greatly during the year, the result may be incorrect." As staff have said THEY KNEW THEY COULDN'T DO IT BECAUSE IT MADE NO F-CKN SENSE.

Specifically, whatever happens, this protocol says the raising and recovery of a debt "must satisfy legislative requirements."

Greggery interprets this: "That is, there must be evidence of a debt, rather than some speculation about it."

Birrer, perhaps unhelpfully (?) for his employer notes: This "shows how averaging was used Pre-Robodebt in a very different context, and in a very different way than during Robodebt. And so it's not the same, it wasn't the same methodology."

Greggery says "I might just have a moment". We love a moment. One moment after another. Now that's living baby!

Greggery turns to staff-check version of the Online Compliance Initiative (Robodebt, before automation on 1 July 2016) in 2015 which "tended to sift out mismatches in dates and information compared to the later automation of the process. would you agree with that?"

Birrer: Yes.

Birrer says it is "worth untangling the two issues" as if they are hordes of mating snakes. He notes that DHS wasn't "really ready" to scale up the program. "It created quite a deal of operational challenges, to put it mildly,
and also a bit of chaos." Quite.

"It was totally oversold, Commissioner. They were sold as low risk... As a slam dunk, like this was out there to get. Even if averaging was lawful, DHS would never have recovered what was in that Executive Minute."

Holmes: "It's the chemical weapons in Iraq."

Well, there's today's news grab.

Birrer continues: "One of the disappointing aspects that has come up in my review of the documents has been the assumption that... If, if people think that this is the wrong outcome they can just appeal, which, which I think is a very poor way of doing service delivery."

Birrer notes that the third iteration of Robodebt [CUPI] between around August 2018 and when program was suspended in 2019 was "a much, much better user experience and also a better overall process".

CUPI stands for Check and Update Past Information (CUPI) which is extremely funny* to me because this is precisely the BARE MINIMUM and what should have been happening from the start and they chose to name the third iteration after a fundamental obligation they never met.

Birrer is asked about efficiency dividends being applied across government. How appropriate is it that these are applied to welfare agencies? He may be a bit biased, he says, but "you need a consistency" in order to deliver services to people. It's true that services are cut.

Birrer: "During Robodebt, there continued to be the APS compliance officers but to undertake the Robodebt program there were labour hire staff contracted. They worked in DHS premises, on their systems and often in blended teams. More about bringing staff in than outsourcing."

With hindsight, Greggery asks, do you see any "critical decision points"?

Birrer: Certainly there are, a number of different points. One was in early 2015 where during the development of the Executive Minute the draft EM was provided to DSS which did respond with some concerns.

Birrer: "Also the over-selling of the potential benefits. I think that was a moment to reflect on the program's highest level design and instead it seems to me the brief went forward largely as it was originally drafted by the DHS."

Greggery reminds him he also said there was an inadequate testing phase in terms of the duration, the numbers, the capacity to scale up.

Birrer: "The DHS rushed to failure."

Birrer: "That created a lot of pressures and stresses within the DHS that was delivering Robodebt and implementing it and that in turn had a negative impact in terms of how they were able to respond to events as they unfolded."

Birrer: "One thing that comes through from discussions with people who were involved with the program at the time is that there was, quite frequently, a very demanding and difficult leadership environment with lots of workplace tensions and aggressive and demanding leadership."

EMOJI LOOKING EYES.

Birrer mentions this at times seemed unhelpful but "at times from people's recounting of stories to me in an inappropriate way, and I presume at some point witnesses will will speak to their firsthand experiences about them" at this Royal Commission. EMOJI LOOKING EYES.

Birrer: I think there was insufficient attention given to providing written advice which conveyed the realities, which was cautious about the identification of potential benefits, and also cautious to ensure that risk is, is appropriately conveyed around projects.

Birrer: "There was an attempt to essentially make it look like everything was going fine." Dog with coffee in flames meme.

Birrer is excused. And that's it for the day. Back tomorrow.

Birrer, Birrer, on the stand, who’s the fairest in all the land? Not DHS.

DAY SEVEN of the Robodebt Royal Commission is going to kick off shortly. We are getting two very senior Robodebt public servants who worked on the policy / proposal at its earliest stages. One of them is now at the NDIA. thesaturdaypaper.com.au/news/politics/…

First witness this morning is Scott Britton, former National Manager, Compliance Risk Department of Human Services. Since he prepared his statement he has come across additional documents which he has reviewed but they haven't been provided to RC yet.

It is a "curiosity" according to Commonwealth counsel Dominique Hogan-Doran. There is a laptop with confused time stamps (it was six hours out??) which didn't help. Counsel for the RC Angus Scott says they accept a supplementary statement will be provided.

Britton mumbling into the mic. Counsel Scott says "you might need to speak up." METAPHOR.

Yet another case of people not being provided with their protected emails. I understand these are secure servers and what have you, but would have thought a Royal Commission notice to produce would have been given some priority.

Protected emails supplied only start in March 2016 (???) to 20 February 2017 (after Scott Britton left). Would have thought they would have started earlier...

Britton: "I'm unclear if there are additional emails relevant to the scope of the Commission's review, I would need to confirm."

And how long would that take to check? Britton doesn't really know.

I don't wanna be jumping at shadows here, necessarily, but something HINKY is going on with the production of documents at this royal commission. It's less than professional.

Britton was nat'l manager for compliance risk w/in DHS from 11 January 2010 to November 2016 but was seconded to the National Disability Insurance Agency (which meant he didn't technically finish at DHS until Feb 2017). Britton providing advice to CEO NDIA about "fraud control."

He briefly came back to DHS in December 2016 until January and then back to the NDIA and although he wasn't technically in his old DHS role he had discussions relating to bits and bobs relating to his former role while there. Keeping up?

Britton talking about the creation of a new division within DHS compliance and risk section to take some pressure off a very large branch, this was done because of new budget measures resulting in more "reviews" of customers. Customer compliance, basically.

What was your understanding of the legal basis under which ATO provided data-matching information? Britton says going back to the 80s and 90s it was data-matching program (since governed by legislation) and, later, by formal agreement.

Ben Lumley, who has come up quite a bit at this inquiry so far, reported to Scott Britton. Lumley was an EL2. Britton said he personally didn't have specific knowledge of the legal basis on which PAYG data was shared. So should we speak to Lumley then, counsel asks. Yes.

Taken to his statement, Britton is asked what he meant when he said he "did feel the increasing pressure" starting in 2010, 2012 "where we started to see measures coming through" when they started looking at modernising compliance channels.

His statement notes that the General Manager Customer Compliance Karen Harfield, to whom he reported, began showing "extreme signs of stress" by later 2016 because she was managing huge workload, expectations of her deputy secretary Malisa Golightly.

Britton said "we were being continually asked for the provision of new ideas, new proposals. New concepts, additional savings, that in itself created additional pressure by continually being asked to identify additional savings." That is, what money can you find for us?

Britton notes a range of conversations from deputy secretary Malisa Golightly, that came via Mark Withnell to him along the lines of "what more do we have, what can we bring forward?"

Britton refers to "sig't levels of non-compliance" and asked what he means. Data matches "where there was a potential or actual discrepancy between information declared by the customer and the information that was obtained particularly from the tax office or other data sources."

Counsel: My understanding of your evidence is that it was not uncommon, when the budget was under consideration, for your branch to be looked to to identify means of increasing activities to increase savings for the Commonwealth for the purposes of budget?

Britton: Yes.

Britton: "That was one of the things that stuck in my mind as far as what was driving or potentially driving the push for additional savings... was that statement or comment around 'this forms part of government budget recovery strategy'." I think the budget papers used 'repair'.

Proceedings interrupted by senior counsel for Commonwealth Dominique Hogan-Doran who says she can get these documents produce after all but "to fast track it I need him to give me his password."

The password is ScottRocks!99

(it's not)

Back to discussing the pressure on Karen Harfield and the size of the branch. It's a very big branch! At one time the biggest in all of government. "I didn't have visibility of every decision, every critical element... but I was part of the conversation."

Going back to "PAYG being brought forward." What did he mean? Britton: that was a program that we had had in place for a number of years. "Late 2014, we were starting to look at volumes of work... we started to do some very early analysis about how much PAYG data we have."

"How far back does it go and what the potential volumes and savings would be? So that was at the early stages were referred to the PAYG measure," Britton says. We are getting to some very important detail here about the birth of this scheme. Still circling the matter a bit.

Counsel: "It's true isn't it that that data, without further investigation, could only identify potential discrepancies."

Britton: "That's correct."

Britton says it "formed part of the discussions" this idea that they could go and look at that data and clean up discrepancies in a more efficient way. He keeps mentioning the government agenda to "reduce red tape."

Britton: "The other layer that I've also talked to was to look for opportunities to modernise compliance processes. They were antiquated and outdated. They were manual - very manual - very time consuming." Yes, hate it when people are involved in enforcing compliance on people!

just spitballing here, but do you reckon machines would do a better job of this job that absolutely requires a human touch?

Britton: "There's a general recognition that, given the size and scale of the work that we undertook within the department at the time - we're talking 100,000s of reviews per year - [and] every one of those required at the time that dept writing to the employer."

Counsel for RC Angus Scott pressing Britton here on his assertion they triaged the "discrepancies" by highest risk, to go after the ones most likely to be a debt. What this does is establish quite clearly that they knew the difference between what was likely to be a debt and not.

Britton shown an email he wrote on 14 October 2014 following a meeting with DSS. "Our discussion lead us to consider options around the large number of matches we created" and the capacity to complete. "We need to develop our thinking around what options would be available."

This email was sent to directors Ben Lumley, Jason Ryman and Owen Lange who all reported to Scott Britton. But does Britton have an independent recollection about this email? "No, I don't," he says. How interesting.

We are getting SO close to Day Zero, if there could ever be one for a vastly complicated deception.

Did Britton normally have regular meetings with DSS (remember he's DHS) in his time there? There were meetings, he said, but "I don't recall specific, like, regular meetings with DSS." What about meeting with Cameron Brown? No memory there. Murray Kimber, yes.

Murray Kimber and Scott Britton worked across the street from each other so there was lots of opportunity for incidental chats and catch-ups generally about the work. Curious!

Commissioner Holmes picks up on the email Britton sent which mentioned the pools of data matches they had going back to 2010-11. But the info protocol said data had to be deleted after a year. That clearly didn't happen. Britton doesn't seem to know what was required.

Britton showed email trail from Oct 2014 where DSS asks for legal advice regarding proposal being worked on with DHS. The question details very explicitly what is being proposed (Robodebt, basically). Does Britton recognise what is being outlined? "It certainly looks like that."

Does this reflect the substance of the proposal, to your memory?

"I think at the high level it does. The inputs appear consistent," Britton says. He is being notably cautious here.

Do you remember, or were you aware, of DSS seeking legal advice?

"Not specifically, counsel. I don't remember having a specific conversation with anyone about 'we need to get legal advice on this particular element'." Doesn't remember being provided legal advice, either.

"I've searched high and low, I've seen nothing," Britton says when asked if he ever saw the advice. "I don't recall anyone calling out any specific concerns around legality which is, one of those moments in hindsight, which, on reflection... no, no is the answer."

Britton notes income averaging was used previously to calculate debts. Counsel: "That would have been after compliance officers had investigated the matter."

Britton: "Ah, yes, that was the previous process."

You don't say.

Counsel: "So would it be accurate to say that the usual practice prior to the online compliance intervention, averaging would be used in effect as a last resort?"

Britton: "It would have been an exceptions process." To translate, yes.

Commission adjourned until 11.50am AEST (but after that declaration heard the Commissioner softly say she thought it had better be 11.45am but nothing else was said so who knows!)

Ooooooooh we back and Britton is being shown a document that purports to be a Minute, addressed to him, titled "concepts for future compliance activity." Britton has signed this document. He wrote: "Jason we should discuss prior to formal commencement of activity."

Attachment to this minute describes the "trusted data assessment" option with Britton's handwriting on it. He has edited it from "how it impacts their entitlement" to "how it MAY impact their entitlement." This is crucial, crucial stuff.

Wow, doc explicitly states "advice" should be sought on matching data. Britton handwrites: "There are considerable policy issues associated with this intent. It will be important to commence the policy and legislative review to determine the scope and boundaries of possibility."

Britton is asked about this.

"I don't remember the specifics and I don't remember seeing it in my own emails but clearly I received that and I've approved it with those comments."

"Based on the contents of the document and my comments, it looks like some of the early, early work or early thinking about moving to automated processes for compliance," Britton says.

I should note, Britton didn't see this document before he prepared his statement. Its production came as a complete surprise to him when he was shown it.

This is as early as June 2014.

Now moving on to discussion of Malisa Golightly, who was deputy secretary above Britton at the Department of Human Services.

"Do you recall having dealings with Malisa Golightly in relation to the development of the online compliance program from the time, from 2015?" In or around that time, yes. Britton also recalls Morrison calling for the proposal in Feb 2015.

Talking about the manual processing (manual intervention) from July 2015 to July 2016. Essentially, a pilot? Then OCI soft launch of 1000 customers July 2016 to September 2016 then it was decided to "initiate large volumes."

Did you have any involvement in the preparation of that brief (that was sent to Minister Scott Morrison)? "Not that I recall specifically," he said. "I don't remember specifically writing a document that's for the purposes of briefing and minister."

Jason Ryman became project leader on program from 2015. But what oversight did Britton have?

"Specifically, I recall that period... I was definitely, most likely, regularly in conversation with Jason and his team around the development of those pilots." Definitely most likely!

Britton being stepped througH series of Qs here, deliberate rule-in, rule-out strategy: do you recall picking the team members, do you recall being involved in any analyses of the budget required, did you exercise any oversight of the technical capacity of the dept to deliver?

We are having a moment of specifically recalling in general perhaps definitely most likely doing some things.

Counsel asking a few times about whether Britton had specific oversight or input into the IT teams / systems re: delivery of OCI. "I know that as we pushed hard into delivery timeframes, on reflection, the challenges were immense," Britton says. "This was a fast-paced build."

"I remember personally having to travel to Adelaide very frequently to meet with ICT colleagues in the build of what would become the OCI system," Britton says. That came out of nowhere. He started that answer not really being able to remember much.

Counsel: "Did you ascertain whether the ICT part of the department had ever been involved in a project of this scale and complexity?"

Britton: "To be honest, I don't think it was really a consideration."

"This was all brand new tech and technology and new thinking. There wasn't really an option at the time to not deliver," Britton says. Brand new tech as a phrase betrays how some compliance people thought of this stuff, I think: that it was sort of like a new toy.

Britton: "There was a critical decision made, not by me, around the initiation of large volumes of activities, and I think, I don't recall specifically what the critical errors that were still in play at the time but that in itself I think is reflective of the pressure."

This is about pressing the button for full launch. Britton was on leave but says his view before he went on leave was that "there were critical issues with the system."

Britton says he had discussions with Jason Ryman about seeking legal advice. Did you give him any advice about what kind of legals he should be getting? "Not that I specifically remember," Britton says. He accepts the Minute he signed shows that it was a live issue.

Did you rely on Jason Ryman to come up with the scope of the legal advice, then?

"Certainly, I relied on Mr Ryman to engage with legals, again I can't recall specific discussions around the scope or definition of the legal advice."

Did you personally satisfy yourself on risk?

Britton both reflecting AND trying to recollect. The Robodebt project team sat outside his office, so there were lots of conversations. "I had expectations, and also trust, in the team that were leading the work," he says. There is no I in Team but there is a ME if you rearrange.

Britton says he hasn't found any status reports or risk assessments in his emails. He's not saying they don't exist, but he can't find them. Perhaps if we average the information we have available at the timeline we can come to a conclusion on what he should have known?

More reflections here than old mate Birrer Birrer on the wall

Scott Britton was the national manager in charge of the team running this project and the guy can barely recall doing his job. Apart from anything else, this is... not a great look.

Essentially, it seems like Scott Britton has left the delivery of this project largely to this team he keeps mentioning so RC Counsel Angus Scott presses harder: well, what steps did YOU take to make sure you were comfortable they were up to the job?

Bits and pieces of advice, personal experiencing. Talking to people!

Poor old Angus Scott, counsel for the RC, has tried to bring up a document twice now to inconvenient delays which is really ruining his element of surprise I think.

5 May 2015 email from Jason Ryman, cc-ing Scott Britton regarding a "Pilot Plan." Owen Lange, who came up earlier, then sends email 6 May 2015 addressed to Jason (cc-ed Britton): "Thanks Jason, we are going to have a % of customers that do not contact." Debts raised regardless.

Jason Ryman writes back: "Hey Owen, you are right in your assessment... what we are thinking is that those who choose not to contact are satisfied with the information in the letter and the process we will apply in calculating the debt."

This is significant.

Can you comment on this proposed thinking?

Britton: "I think that is an assumption. I will also reflect on, this was early thinking, I think the pilot phrase, so the volumes were small. But you're right, an assumption was made... and later applied [to the OCI]."

18 June 2015 from Mr Ryman to Scott Britton among others. "All apologies for the delay in sending this out.
We identified some errors in the previous report so we have double checked all the data to try and avoid any further problems."

PAYG Pilot report was attached to this email. There's a graph with "customer behaviour" on this attachment. It's a pie chart. "Status: all cases initiated." "From the above graph we can see that there is a total of 58 per cent of customers who have not contacted."

The note says this means "the match data has/will be applied to the customer's record."

Britton recalls there was an outbound call on or around Day 7 to see if participants got the debt letter but he can't remember how that panned out. "That was one of the initiatives to try and better influence the behaviour to respond and clarify the details." Behavioural nudges.

Britton: "So this is, again, at the very early stages, the use of behavioural insights. So, the content of the letter the language of the letter was different to the normal approach that was taken, particularly by DHS and former iterations, a bit less directive." Hate this shit.

Worth reiterating here that these behavioural nudges or "influences" were not about trying to make lives better for people at the end of a debt notice. We previously heard the letters were deliberately designed to claw back more money.

Britton: "I think government more broadly was thinking about how you can use behavioural insights or behavioural science to inform and influence particular behaviours and in the compliance space, in particular, we were thinking... how we could apply behavioural insight." Yuck.

Adjourned until 2.15pm AEST. I am going to have a power nap.

Gremlins, we back. Britton still on the stand with the dreaded words "I'm just going to take you to some documents, Mr Britton."

Ooooooh we have an email November 2016 from a DLO in Alan Tudge's office to the Department of Human Services. Mentions Tudge senior adviser asking "when will the Department achieve its 500 million" target. That's dollars, in savings.

Britton recalls it is $500 million "linked tot he compliance measures, compliance savings" can't recall which one. Britton accepts there was a target. "I can't recall where the target came from, whether it was an amount set by the Minister's Office or a forecast."

21 November 2016, Malisa Golightly writes back saying she was not aware there was a $500 million target. She suspects this was something a minister's media adviser wanted? Britton writes back confirming this version of events bc it was a milestone amount the MO was interested in.

Next doc: 17 November 2016 email from EA to Mark Withnell sending the October report to Malisa Golightly with "percentage of compliance and fraud activities resulting in a debt or payment variation as agreed by the Minister."

This report would have gone to the DHS executive. Secretary and deputy secretaries basically. Britton thinks the handwriting is Malisa Golightly's.

Golightly: "Scott (Karen) re: items marked, I know that Oct was the first few weeks of our increased numbers of interventions but these savings figures on the surface level appear very low. Are we happy that the savings are commensurate with the interventions?"

Are. We. Happy. With.

Britton emails Golightly and Karen Harfield on 16 January 2017. Britton notes he attended DSS meeting with Serena Wilson, Cath Halbert and others with the Commonwealth Ombudsman's reps. Can't recall what he meant by writing Wilson'd briefing was "generally accurate."

In this email, Britton writes: "They [Ombudsman] informed DSS that they were comfortable with the policy position."

Email 8 Nov 2016 from Alice Linacre to Scott Britton and others, cc-Annette Musolino re: AAT tier 1 and AAT tier 2 appeals. This sensitive legal advice notes that of the decisions set aside (where tribunal essentially says 'you got this wrong') these are higher under this program

The email notes: "The AAT1 has recently been more strident in its criticism but is limited to a few cases which are unpublished." Notes these numbers are "still not considered to be a threat to the program."

January 2017 email from Alan Tudge to Malisa Golightly. Tudge needs to give a detailed update to the Prime Minister (Turnbull at that point) on some issues being raised publicly re: Robodebt. He mentions Peter Martin column in Fairfax.

Golightly writes back to a colleague on 8 January 2017: "Also I think we're going to have to clearly explain that the initial data match does not compare fortnight by fortnight in the first instance." Hoo boy. Might have been key to do this verrrrrrry early on.

Angus Scott, counsel, zeroes in: "Just interested in the second last sentence on the bottom of the first page, the words 'if they're not in tolerances would first seek further evidence before calculating a debt.'" Is that accurate? Britton: "It doesn't sound quite right."

Are they straight up lying to the Minister?

Britton all over the shop. "There's a blurring of my recollection between the pilot program... and then what actually occurred in the automated process. So that's that's the reason why I'm not being as decisive as what I'd hoped to be in relation to that question."

Britton remembers activities around this email but does not recall the email currently being discussed.

lol fuck me, Scott Britton ('s office) nominated Jason Ryman for an Australia Day Achievement Award internally for his role in "leading the Online Compliance Initiative" which is first version of automated Robodebt.

Britton: "I don't recall receiving anything to say that he had been successful."

[sad trombone]

Here we go, a risk management plan for Employment Income Matching! Endorsed by Britton 6 August 2015 (he really didn't seem to remember any risk management plans earlier in the day).

Counsel: "Did you read this document closely before you signed it?"

Britton: "I expect I would have, yes."

And did you scrutinise it to make sure its contents adequately reflected what ought to be in such a plan?

I expect so.

On the risk table, one of these is that the ICT systems won't be able to deliver "required business outcomes." All those questions counsel asked Britton this morning that seemed to go nowhere? They are coming home to roost now.

There are a bunch more risks cited here including that government could change during program rollout and that program "governance and processes are inaccurate." Nowhere in the eight or so risks specifically listed is data-matching and the way it is used mentioned.

Counsel: "Do you accept... that the development of the program... should have involved input from stakeholders with expertise in the needs of the customers that would be affected, including proper consideration of particular vulnerabilities and social factors."

Britton thinks the core intent and the drivers of modernising the compliance activities was "sound". "It was about improving outcomes for customers, whilst that didn't translate throughout the OCI, that was the intent," he says. Minimise the hardship of debt! This is off-planet.

Commissioner Holmes, a little surprised: "How are you minimising the hardship of debt if you're going back four years?" And a lot of your clientele, she says, wouldn't have been heavily online. Britton: "Yeah, that's a good point Commissioner."

Commissioner Holmes: "The most vulnerable layer of your customers would be the least likely to be able to deal with this, surely." Britton concedes this is "fair." This is what happens when you don't have experience of these things in the public service or anywhere in society.

But sure, this was about ~helping~ people. Remember early on in his evidence Britton mentions this constant pressure to find savings as a "driver" for this concept being cooked up. This was never about helping people. Stop it. And with that, Britton is done for now.

Australia Day Achievement Award nominee Jason Ryman (nominated by Scott Britton, his boss) for "leading" work on the Online Compliance Initiative (Robodebt) is now up. Wonder if he remains grateful to Britton for the former's enthusiastic outlining of responsibilities?

Jason Ryman making a correction to his statement where he referenced a document not being provided to the Ombudsman. He said it was a doc re: analysis indicating debts may increase approx 30 per cent when income averaging is applied. This was not given to Ombud!

I think he said 30 per cent. It might have been 50 per cent.

Ryman was an Exec Level director in DHS from 2011 to 2017, reporting to Scott Britton. Going over the "imperfect" matching of averaged data, history of when it was appropriate (never on its own and a last resort with manual checks) etc

Ryman mentions the "trusted data assessments" they were analysing. Basically, data held by third parties (ATO, hello!) which they could use to run compliance checks.

Now Ryman is being shown the Minute signed by his boss Scott Britton on 30 June 2014 and with handwriting by Britton to Jason noting a discussion should be had. Jason is the apparent author of this minute (he put it together for his boss).

Is this document a product of those discussions [about using trusted data assessments]?

Counsel: "It's obviously very early, but this is the start of the development of the online compliance intervention, isn't it?"

Ryman: "This is a component of it."

October 2014 meeting with Britton and Ben Lumley to discuss potential budget measures for 2015-16. Do your recall what was discussed?

Ryman: "The disc. was about the PAYG data and the number of cases that we had no undertaken any review on." More data than they could review.

Basically they had a whole pile of "maybe someone defrauded the government" with no proof but that represented a BIG bucket of money if they could find a way to turn them into debts. Of course, having humans do the checking was going to cost more than it was worth.

Ryman says he does not recall specifics from the meeting with Lumley and Britton. But there were action points written down. Including "some drafting of possible processes where we would have an online solution and we would ask the customer to go online and respond."

Ryman says the initial discussion was about possibly sending a legal notice telling the customer to go online (referencing the relevant part of the Act). This is significant because the letters did not do that at all.

When asked about what the letters included, Ryman says: "I don't recall."

Counsel: "Would it be right that, throughout this, the process that was being contemplated at all times was PAYG data would be used to calculate an amount of fortnightly income received by Social Security recipient, if they did not engage with initial contact from the department"

Yes, Ryman says. And counsel says this averaging was applied to raise a debt.

Counsel: "Did you understand that to make that assumption without further evidence would be to engage in speculation?"

Loooooong, uncomfortable pause. "I'm not sure that's the right way to frame it."

But Ryman does concede, in follow up, that such an assumption would likely to be untrue and therefore needed subsequent investigation to verify. So if you accept that, which he now does, isn't the approach speculation?

Ryman: "Yes, OK."

Commissioner Holmes gets to the point: well if you accept all of this, how is any of this possible? "How was the system allowed to be set up on that basis? Because it just wouldn't be true for a great number of recipients." Ryman says not untrue, just not accurate!

Ryman admits, accidentally, that the thinking was that customers would just engage with the process and do the work for them.

Counsel: "Did it occur to you, given the nature of the assumption that was intrinsic in this process, that was under consideration, that the scheme when it was eventually rolled out would be unlawful?"

Ryman, bravely: "No."

Counsel: "And yet it occurred to you that it would be necessary to obtain legal advice about its lawfulness."

Ryman: "Yes."

This was in JANUARY 2015 folks.

Counsel: "Do you believe any advice that you obtained in the development of the online compliance intervention addressed the question of whether or not income averaging, would be a lawful basis to calculate debt?"

Ryman: "Not directly, no."

I'm no legal scholar, so take this with a grain of salt, but this is painful to watch and I do not believe it to be going well.

Ryman became project manager for the development of the Online Compliance Initiative on or about June 2015, appointed by Scott Britton. The project team is listed. Angus Scott: "Would it be right that none of you were lawyers?"

Ryman: "Yes."

Would that be a disadvantage? Yes, Ryman concedes.

Angus Scott, borrowing from Holmes' invocation of chemical weapons in Iraq yesterday, says "to use the Donald Rumsfeld expression, you don't know what you don't know, correct?"

Correct.

So many 'don't recalls' and 'can't remembers' and 'I'm not sures' here that if you stitched them all together you would have a rich, rich tapestry of precisely nothing.

Basically Ryman is not aware of any non-government organisations with expertise or advocacy in social policy were consulted. @ACOSS not consulted, for instance.

During soft launch with 1000 customers, do you recall any issues being recorded?

Guess what Ryman's answer is. GUESS.

Commissioner Holmes asks about the pilot of the program (with manual checks). "So what would you discover, that you could average income and people wouldn't appeal or what was going to come out of that?"

Ryman now agrees with her "I wouldn't say it was much of a pilot."

Basically, how do you run a pilot with manual checks and human oversight on 1000 people and then remove those checks and balances for an entirely online program and consider that the first could possibly inform the latter. That's what Ryman now concedes: you couldn't.

Ryman on that first pilot: "I think you would say there were unknowns." Hey, now you're just cribbing notes from counsel re: Donald Rumsfeld.

There was a meeting about the pilot and Ryman, stumbling, says he was asked by Karen Harfield [after] if he had anything further to add. He suggested they still hadn't finished getting through the 1000 trial customers and they should do that before going to larger numbers.

Holmes: "Was that designed just to bring up any technical hiccoughs in the system, or were you actually doing some sampling to see what proportion actually did recover debts which were objectively provable against other means, other sources."

Ryman: more the technical side.

Holmes: "Didn't you need to have some idea of how many of these discrepancies would actually result in a debt which could objectively be proved?"

Ryman: "We believed that what we were doing was legal."

Holmes jumps. "LEGAL?"

Ryman: "Yes."

OK, now we are getting into the workplace culture which was EMOJI LOOKING EYES flagged yesterday by another witness. Had a few private messages about that. Now Ryman being asked about "some dealings" with Ms Golightly after soft launch.

Counsel: "You state Ms Golightly would lose her temper and would shout at you and make personal comments about you."

Back to the 6 May 2015 email from Owen Lange to Jason. Ryman's response, saying you are right.

"Can I confirm that you expected that there will be a % of customers that would not respond to the initial letter identifying the discrepancy between the ATO and DHS data?"

Ryman asks counsel to repeat the question then said "yes, I wouldn't say it was an expectation, it was an outcome that was likely."

And your thinking, to confirm, was that those who "choose" not to contact would be satisfied with the info in the letter and the process? Yes.

But Ryman concedes there could be many different reasons why a customer didn't respond including that THEY DIDN'T GET THE LETTER. This is diploma in fraud management stuff. So how could you proceed on that basis?
Ryman: "I think this is something we were looking to understand."

"So how do you then adopt the thinking that those who choose not to contact are satisfied with what is in the letter?"

Ryman: "Well this is saying those who choose."

Counsel: "How do you know who chose and who didn't?"

Ryman: "You don't."

FMD

Now Ryman being shown the PAYG Pilot report to 12 June 2015, we saw earlier where it noted 58 per cent of customers had not responded and which states very clearly that "matched data will be applied to the customer's record."

Counsel asks Ryman if, going by previous logic, it follows that these 58 per cent of people accepted the information that was provided to them in the letter.

Ryman: "I'm not sure that assumption is being applied directly to this, but yes."

Commissioner: "Can I raise with you a cynical proposition. A cynical view of this might be that what you learned from that pilot would be that if you went ahead with this you'd have something like over half of customers who wouldn't give you any trouble (cntd)

"And chances were you'd be able to recover it. And they would remain acquiescent. And you would just have this passive market?"

Ryman: "No, I don't think that was the outcome we were looking for."

Ryman being asked why a phone number wasn't included on the initial debt letters sent to customers.

"We were really seeking customers to go online," he says.

Commissioner: "To minimise compliance officer engagement. You didn't want them ringing up."

Ryman: "It was really to encourage people to go online. I know this got changed later in 2016 to include a number in the letter."

Commissioner: "Was this before or after the Ombudsman got involved."

Ryman says it was once they got involved. Shock!

Was the decision not to include the phone number on the letters influenced by behavioural science, counsel asks.

Ryman: "I don't recall."

Counsel: "The program team drew on advice from experts in behavioural science?"

Ryman: "Yes."

Counsel: "So it could be the case that a person would receive a letter like this and accurately indicate
what they earn from particular employers during particular periods, and decide not to contact the department because insofar as they were concerned it was accurate. Correct?"

Ryman: "Yes."

Counsel: "But it gave them no warning at all. That they were at risk of having their Social Security entitlements calculated using income averaging. Right?"

Ryman: "Yes."

Counsel: "The result of that calculation could be inaccurate, correct?"

Ryman: "Yes."

Counsel: "And then a debt would be raised on the basis of that calculation, correct?"

Ryman: "Yes."

Fin. Adjourned.

(Finn Pratt tomorrow!)

That was quite a day. We have learned a great deal about the greed and antipathy underpinning Robodebt.

So, after we learn Jason Ryman was nominated for an Australia Day Achievement Award (didn't win) for his work on Robodebt I have also learned the entire DHS nominated its work on this for an Institute of Public Administration Award 2016 (didn't win). vs286790.blob.core.windows.net/docs/Past%20PM…

They were so in love with this ripper of a project.

“We came up with a way to crush poor people… faster.”

And here we are, ready for DAY EIGHT of the Robodebt Royal Commission. We ended yesterday with some insight into who raised first inkling of it and why this particularly nasty flavour of compliance was cooked up: mountains of matched data too big to review manually but worth $$$

What we still don't know is precise mechanism by which someone or some group said: let's proceed despite all of the warnings. We know Minister's offices were keen once they saw the concepts, but how did it get that far? Today two key DSS players: Serena Wilson and Finn Pratt.

My boo Justin Greggery KC is back today leading affairs as senior counsel assisting the Royal Commission. Serena Wilson, former Deputy Secretary, Social Security, Department of Social Services has been sworn in. She has been named a lot already in this inquiry. Now we hear.

Just getting the basic details out of the way first: organisational chart, roles and responsibilities, who reported to who etc. The Patrick McClure welfare report gets a mention (you may remember him from previous welfare reports in the 2000s).

Greggery: "You've described aspects of legislative and policy responsibility on the part of DSS in the day to day work of DSS, how are those matters related to the service delivery aspects undertaken by DHS?"

A simple, easy questio... or is it.

Wilson names guide to the Social Security law which is the "Bible" and an online resource was "overarching authority, I guess, of translating both the Social Security Act and the Social Security Administration Act into a somewhat more accessible form and perhaps intuitive form."

Greggery: "Who in the area, supervised by you or overseen by you, stayed on top of the guide to Social Security Law?"

Wilson: "Every area."

That will be a useful exchange later, I suspect.

Every area had a responsibility, she says. I realise I did not make her response overly clear!

Generally speaking, the assistant secretary in each subject matter area would have responsibility for the guide accurately translating the legislation etc. Wilson says as she recalls there were hyperlinks to the different sections of the Act (there are).

Then, of course, DHS might develop process guidelines based on the Guide to Social Security Law which itself was based on the Social Security Act and the Social Security Administration Act. I imagine each translation undertaken as monks might handwrite the Bible over and over.

DHS process guidelines (probably):

Wilson is being asked broadly about what happens when there are problems with the interaction between policy and the legislation. In short: the more significant the question, the higher it reached in terms of the department. Wilson: "That's correct."

Wilson on r'ship with Secretary: "Very significant changes in the budget for example, we would discuss them perhaps ahead of meetings with with ministers, we would certainly discuss them in preparing the portfolio budget submission, documentation and various budget documents."

Wilson: "And Mr. Pratt because he was expected to, well he did, regularly as the Secretary of the Department, go into the expenditure review committee with the Minister for Social Services, he would need to be quite well versed in a level of detail about those changes."

Wilson: "And it was not infrequent that Mr. Pratt, myself, a Senior Executive Service Band 2 and possibly an assistant secretary or some other subject matter expert, would have discussions on DSS proposals with the Minister, with [Min] advisors present."

Here we go, Greggery recalls Wilson mentioned notebook entires and diary entries and that she retired in 2018 but in reality she took leave before that and left the building - "my last day in harness" - was around June. These notebooks are all destroyed, apparently.

"They were not official records, they were personal jottings, they were mainly lists. It was standard practice, I believe, to do that. I had no intention of having any ongoing APS employment," Wilson says.

Wilson: "We would have done, possibly things like text messaging, but I didn't come to things like WhatsApp until very recently." I suspect not just possibly text messages but that there absolutely would have been.

Ohhhhhhh they called the secure email server the "secure enclave" which is objectively a very cool sounding name.

Because of the nature of this secure enclave, the emails (in this case some 8000 of them) were only available on a tablet provided by the AG Department which Wilson had to travel into Canberra to read (she lives outside Canberra). Travelling into Canberra! What indignity next.

The pace and precise tone of this testimony is such that it could be recorded and used to calm wild horses.

I've almost fallen asleep. Certainly I have stopped bucking my rider.

I am going to join approximately 12 minutes of testimony into one tweet: you didn't do a very good search of documents, did you, because you didn't find anything relating to this legal and policy advice despite the fact we know there must have been? She used a personal notebook!

Greggery: "Surely a more accurate way, as part of your official responsibilities and Mr. Pratt's responsibilities, to record that you had communicated information of significance to him would not be in the personal notebook but would be in the form of a memo, or an email?"

Wilson: "It is evident from my statements that I intended to discuss the issue with Mr. Pratt. I cannot independently recall whether I did at that point in time." Independent. Recallways. (I am so sorry)

Greggery, a little exasperated, says there MUST be a record of this proposal for Robodebt in DSS because, as Wilson says, it was part of this budget process. "It was an area of your responsibility, you were the deputy secretary," he says. Wilson is taking us on a tour of nothing.

Wilson, more talking

Greggery: "That sounds like there's a record of a DHS proposal in DSS prior to compilation, as a new policy proposal?"

"I would believe so," she says, but "I've not been able to identify the draft or the final of that proposal in my searches to this point."

Greggery: "Haven't located an email which records the actual communication of it. And to the extent that you might have recorded it in your personal notebooks... they no longer exist."

Wilson: "That's correct."

Greggery: "And you now can't recall whether you did [speak with Pratt] or not."

Wilson: "It was a long time ago."

Greggery: "It's also a very significant question though, isn't it?"

Wilson: "Yes."

Greggery says this matter kept coming up, especially 2017, how could she not have thought about it? Then: "There's no reason to doubt that you did, in fact, communicate the 2014 advice to Mr. Pratt. Because you said in an email that you intended to and it was significant."

Wilson accepts there was "no reason" to think she did not follow through, based on the email that said she would raise this matter with Secretary Finn Pratt. Cannot believe the pulling-teeth nature of what it took to get us to this simple observation.

Greggery asks for a moment. Our boy loves a moment. We are keen to provide him many moments, as they are eventually lived in to great effect.

Wilson being shown 12 November 2014 email sent from Murray Kimber to her and Cameron Brown. Murray notes the discussions about a potential new policy proposal for the budget and that it "sounded OK, however, as we discussed it did have a number of issues."

"Following further investigation we have confirmed as much."

Greggery notes this email indicates that Ms Wilson knew about this proposal before the date of the email (Nov 2014), so what was that knowledge? "Then Minister for Social Services, who was Kevin Andrews had either requested or had indicated an intention... to look at compliance."

Wilson accepts the email here describes what would become "the key features of the Robodebt scheme." It notes that the Minister was keen on chasing social security "overpayments" but didn't know about the specific proposal here so they had a "Plan B" to keep him happy.

Email chain 16 January 2015, Andrew Whitecross effectively summarised the concerns and legal advice to Wilson. She writes back on 19 January: "Thanks, I was concerned when Malusa [sic] described it to me. I will go back to Malusa [sic] and let Finn know."

Greggery: "You must have received some information from Ms Golightly about the DHS proposal before you requested advice."

Wilson does not "independently recall" the events between email from Murray Kimber and her request of Andrew Whitecross to get some advice.

Greggery presses that the interaction with Malisa Golightly had to have happened before the November 2014 email. "I'm asking you to accept as a matter of logic" that this happened. "They're not different policy proposals, are they?" She doesn't recall and is unable to say.

Serena Wilson may have just invented time travel, refusing to accept the temporal sequence of events here as a matter of logic.

Greggery presses again, and again by breaking down the timeline. "Are you saying that this email may not bear any relationship to the November 2014 email insofar as the concept of advice is concerned?"

Wilson: "What I'm saying is that in November 2014 I was made aware that advice was being sought. I do not recall and have no evidence that that advice was sought at my behest." She accepts she requested advice in Jan 2015, or believes. That email does say "Serena, you requested."

Oh my God this is so good, she says she thinks she asked for the Jan 2015 advice on or around 15 or 16 January (Whitecross sent her an email on 16 January). Greggery, clearly hoping to pin her on the time travel problem asks: "And why do you say that?" Wilson cottons on, fumbles.

Basically, Wilson refuses to accept she had to have asked for November 2014 advice before that email was sent but then stumbles into a Greggery trap re: 16 January 2015 email from Whitecross who mentions she requested advice and she says she must have asked for it before that.

If the logic holds for January, it must also hold for November. Wilson is ducking and weaving like a duck on a loom.

Greggery: "My question was given that you can't recall anything, why do you believe that you sought the advice shortly before the 16th of January?"

Wilson: "I'm unable to say. I can't recall."

This is where he goes for the kill.

Finally, she admits that she "cannot exclude [she] sought the advice before the November 2014." Adds that she also can't demonstrate that she did but Greggery is quick: "Or that you did not."

Wilson: "No."

That was a masterclass.

Greggery: "And it wasn't just information you sought, it was advice, and I suggest contemplated both legal and policy advice."

Wilson: "Ummmmmm. Generally, the term advice..."

This is the January 2015 email, by the way. Greggery: well, you got back policy and legal advice. "And you have got no independent recollection that that came as a surprise to you, that someone gave you legal and policy advice after you requested that advice."

Wilson generally accepts this is what she got back, but notes it as a summary of the policy and legal advice.

Greggery then takes her to the advice which he says is "unequivocal" and steps her through the elements.

We are going through it bit by bit. Wilson accepts this is about the scheme that would come to be known as Robodebt. She accepts the interpretations of counsel as he steps through each element.

Greggery: "The question of review rights were raised, that it would be likely debts raised in this manner would likely be overturned by a tribunal based on current law, that was significant to you, wasn't it."

Wilson: "Yes."

Significant policy aspect of its unfairness.

Whitecross raised the fact that Single Touch Payroll would mean accurate, real-time information could be obtained. But Wilson knew that the Single Touch Payroll was some years away from being ready. But waiting for that would mean "opportunity to recover debts" would be lost.

Greggery: "So the only advantage from your position as Deputy Secretary of the DSS, to the DHS proposal, was short term debt recovery, Debt raising and recovery. But on every other level, or from any other perspective, it was a really bad idea."

Morning break. Timing!

We are back and my pasta hasn't finished cooking :(

Greggery takes Wilson to her response to Whitecross (I typed it above) where she says she was concerned when Malisa described the proposal to her. Have you been able to locate any record of your communication to Malisa G about the advice?

Wilson: sort of. Some records.

Wilson: "I have been able to locate an email trail into which I'm copied where I believe that my concerns were attached as a comments box. I have also been able t... that's probably sufficient."

Again, Greggery notes that there appears to be no documentary record of these concerns being communicated. The manner in which they were. Wilson points to DSS comments back to DHS on draft brief. But also believes late Feb/early March she had a direct interaction with Malisa.

There are fewer documents in this documentary trail than the term "documentary trail" would have had us believe.

Wilson says that although she did not personally transmit the info / concerns to Golightly, but DSS did provide it and that it was very specific and detailed. She says that DHS did get this in writing.

Greggery: "You understand the difficulty in making comments on a draft which is underway, as opposed to saying 'you can't advance a draft on this basis because one, it won't raise legally valid debts, and two, it's against all social security policy."

Greggery: "The train's leaving the station isn't it?"

Greggery: "But whenever the telephone call was and whatever language you used, there was, as a result of that or afterwards, a DHS proposal that went to the Minister which had this central theme in it."

Wilson says the final brief to MO did not fully represent DSS concerns.

Greggery: "How is it that DHS allowed a ministerial proposal to be advanced to the Minister?"
Wilson: "I cannot answer that."
Greggery: "But it's your responsibility. isn't it... to ensure the proposals which are neither supported in law or policy, don't get some traction?"

Wilson says, hindsight, it was an unusual and unconventional process. "I did not have visibility of what happened between the comments that we provided and what was reflected in the brief to the Minister for Social Services. Had I done, clearly, I could have acted differently."

I'm trying to eat lunch at the moment, so a bit slower on the uptake. Wilson saying it had become a practice for DHS to brief the Minister without any involvement from DSS officials. Which is fine, but in this case DSS did know about what was happening.

Wilson: "I believe the mechanism was well understood by the Department of Human Services. I had trust that it would go back, in quite direct and specific terms, through to the Minister for Social Services."

Side note, seeing as it is a benefit, hindsight will now be subject to income means testing. If you have too many you will be tapered off.

Hindsight, Wilson wonders if "previous... arrangements where the Department of Social Services was clearly responsible for policy, maintained the guide that provided direction to Human Services about the authority of that process, and the due consideration of it had atrophied."

Commissioner Holmes: "You seem to be speaking in code, almost. You're saying that DHS seems to be encroaching on DSS jurisdiction."

Wilson: "That is what it looks like in hindsight."

This would involve Scott Morrison (Min Social Services) at the time muscling DHS Min Marise Payne out of the way which would, uh, fit with what we know about Mr Clown Car Ministries

Wilson: "It appears that the briefing, the final product, went directly to the Minister for Social Services, not through the Minister for Human Services, so it was directly from Ms Golightly, I believe, to the Minister for Social Services." DHS dep sec briefing Morrison.

Commissioner Holmes confirms for the record that Malisa Golightly has since died (December, if I recall).

Greggery: "What do you mean by the style of the ministers themselves. Let's start with Minister Morrison."

Wilson: "Fast-moving, highly interactive in a verbal setting [ed: wtf], lots of ideas for which responses were sought at the same time, so very energetic."

Highly Interactive in a Verbal Setting sounds like hell, tbh

Just ask: was Morrison a control freak?

Oh this is significant.

Greggery: "We've been provided with information which indicates that you and Mr. Pratt mer Minister Morrison on 22 January 2015, you had your clear policy answer to the proposal that was being discussed and you had your clear legal answer."

Wilson, you will not be surprised to learn, does not recall what happened at this meeting.

Greggery: "The uncertainty about [Robodebt] was allowed to develop under your watch, wasn't it? Because instead of saying 'no' to the proposal going to the Minister, you engaged with DHS about how it might be framed."

Wilson: "We were trying to be collegiate."

COLLEGIATE

Wilson "I thought we had killed it."

Greggery: "Did you say that to Minister Morrison at that meeting on 22 January 2015?"

Wilson: "No."

Greggery: "The clearest way to kill it was to commit the advice, both legal and policy, to writing and send it to your own minister."

Wilson: "With hindsight I wish that we had."

Greggery: "In hindsight, there was nothing stopping you, was there?"

No.

Key point: Wilson never had an assurance that income averaging would NOT be used by DHS which, Greggery says, means she couldn't possibly have believed they had killed the Robodebt policy.

Greggery, nudging and winking: "If there was a problem communicating this to him [Scott Morrison] now is the time to explain it."

Wilson: "I didn't feel on the 22 January, wrongly, that we were at a point where work had been completed and there was a risk it would go ahead in the form in which it did."

Earlier, Wilson doesn't remember that meeting. But we'll take this as read.

So what DID she understand of the budget measure that was being worked on, and when it became a measure.

Wilson: "My knowledge and my belief at the time was that it did not involve income smoothing."

Wilson knew forecast savings were $1.7bn over four years. Greggery: Given you knew this figure and that it was "a program involving the scaling up of debt identification and recovery, how could you possibly come to the view that that could be achieved without income smoothing?"

Wilson: "When I checked the final new policy proposal document when it went into the portfolio budget submission, there was a sentence... That said, there words to the effect of 'there would be no changes to the way in which PAYG earnings are assessed and debt is calculated."

She hasn't been able to see this document before this hearing, which suggests it might be admitted into evidence later during this Royal Commission.

Wilson says she was "wrong" on the stand about her belief there was no income smoothing.

Greggery: "When did you realise you were wrong about that?"

Wilson: "It was after the measure was introduced."

G: "Can you be more precise?"

Wilson: "It would have been into the course of 2017, and I really can't recall it was some time ago, likely in the latter part of 2017."

This is pretty significant, also, given that Robodebt wasn't suspended until late 2019.

Greggery: "Did you at that point, say, as a deputy secretary 'This is unlawful. And it is against policy, and it needs to stop' to someone?"

Wilson: "No"

Why not?

Wilson: "I find it hard to explain now. Lack of courage."

She also suggests her attention was on other government priorities and she didn't have access to much good data to back up this understanding such as AAT decisions / reviews and DHS were running.

"Now I am ashamed and, in hindsight, I could have spoken up."

Wilson: "I had been
assured, immediately after the measure was implemented, that income smoothing was not occurring."

Greggery: "By whom?"

Wilson: "Ms Golightly."

Anyone else? Can't recall.

When you didn't speak up, lack of courage, was there something you were fearful of?

Wilson: "My gut was telling me something was wrong."

Greggery: "You had legal and policy advice, it wasn't intuition was it, or guess work."

Wilson: "No."

Ohhhhh, when pressed what external factors might have made her afraid Wilson says "my secretary had changed." The new secretary was Kathryn Campbell. Were you fearful of her?
Wilson: "I had a different relationship with her than I did with Mr Pratt."

Yes, but be more specific, Greggery says.

This is the longest pause of this inquiry so far.

Wilson: "It was a less warm and... mutually respectful relationship. It was... a different cultural experience."

Wilson: "It was a more authoritarian environment." This is specifically regarding the change in leadership when Kathryn Campbell came from DHS which incubated and delivered Robodebt to secretary of DSS.

Wilson again says her gut was telling her something was wrong. SHE HAD LEGAL ADVICE.

Wilson: I was surprised to find out on 15 January (2017) that, as had apparently been the practice for some time, that there was what DHS called some last resort use of averaging when no other information was available. So I inquired and pushed and was reassured."

We have arrived at the Ombudsman inquiry report, which Wilson was involved with. That Ombud report mentioned that income averaging was being used. Wilson seems to have forgotten this.

Greggery: "But do you recall having a moment after reading the report when you went 'averaging is being used on a fairly widespread scale here'?"

Wilson: "I didn't have a sense of scale."

Greggery gets Wilson to admit there were no barriers to raising issues with Finn Pratt because they had a good relationship. So, did she raise this issue once discovered?

Wilson: "I don't recall doing so, no."

Back to this 15 Jan meeting with officials. Sunday, it was called to brief Wilson before starting back at work the next day from leave (when meeting with ombudsman's office was scheduled).

Greggery: "You may have kept notes in your personal diary but they... no longer exist."

Others kept some notes, however, and one of these notes that income averaging WAS being used where there was "no other info." Wilson concedes this seems to be the case. Greggery: "Debts were being raised solely on comparisons of PAYG data, correct?"

Yes

Greggery takes Wilson back on a tour of the 2014 and 2015 legal advice that said this was clearly unlawful. Yes, she concedes.

Greggery then submits that she must have known this component of the Online Compliance Initiative (Robodebt) was unlawful.

Wilson fumbles.

Greggery: "My point is that you had actual knowledge that the law did not allow income averaging at this point in time?"

Wilson, accepting she is cornered: "Yes."

And, suspense, adjourned until 2.30pm AEST.

Alright, I have gone grocery shopping, attended to some admin, had a brief 1km stroll to get some coffee and returned for the afternoon. I've been thinking about Wilson. The only one in real power to so far to express any hint of remorse or sorrow re: actions. An observation.

Greggery, harking back to before the break when Serena Wilson mentioned she read the final ombudsman report and was involved in the investigation.

"At different points I was," she says, softening the broad net of 'was involved in' there.

Lol, Commissioner Holmes says she can give an exhibit whatever number she wants, would it be easier to do another way? Greggery KC doesn't seem to care but she adds: "I'd look at your solicitors for this one." They are all nodding ENTHUSIASTICALLY.

Impossibly cute little moment in a terrible saga.

Greggery reiterates, "you were again in no doubt about the use of averaged income under the OCI program in April or May 2017."

On the basis of this, Wilson says, "yes."

Greggery: "Your appreciation of averaging, that is your awareness of averaging in late 2017, came with the acknowledgement that its use in the calculation and recovery of debts was unlawful according to the 2014 advice."

Wilson asks for repeat of the question. Pause. "yes."

How did Wilson rationalise the 2014 advice and the 2017 legal advice.

"I saw them as incongruous... and in conflict."

Greggery: "But you were able to rationalise those, as sitting together well, for the purpose of the ombudsman's investigation."

Another long pause.

Wilson: "My recollection is we gave both pieces of advice to the ombudsman..." long pause... "that we explained that our understanding of the OCI at that point in time... [long pause] was that there was a degree of last resort [pause] averaging going on [VERY long pause]

"... and that there was some legal support for that occurring in the event no other information was occurring."

Phew. Got there in the end. Very carefully worded.

February (12?) email from the assistant ombudsman asking for the authority under which they did this, which has been admitted before. Greggery says "you were acutely aware that what the ombudsman was asking was whether it was lawful to average income to raise a debt?"

The response, cleared by Wilson, is brought up. Greggery: "What is conveyed in the language is that, essentially, a justification for the use of income averaging on an ongoing basis."

Wilson: "Sorry, is that a question?"

We repeat.

God this is so painful to watch.

Greggery: "As you said in response to a question by the Commissioner earlier this morning, it doesn't really make any difference whether it's as a last resort, or the starting point. That is, it doesn't make any difference to the lawfulness."

Wilson: "On reflection, no."

Greggery: "Well, I suggest you knew that at the time."

Wilson: "I knew that we had two sets of advice that appeared incongruous [very long pause] and I, I can't recall, exactly, what I [long pause] thought about the two at the time, I felt [pause] uncomfortable [pause]...

"... but at the time - and this is with hindsight and reflecting on it - [extremely long pause] I [long pause] found it [pause] challenging to reconcile the two."

Wilson: "I was unable to see what was happening but in terms of the essence [pause] of the legal position, when I look back on it, there was no change." (Between legal advices).

Greggery: "My suggestion is that you knew that at the time it was given to you on the 15th of January, you knew it when the ombudsman's report was published and you've given evidence you knew it at the end of 2017."

Commissioner points out that DSS had put in writing that it had become satisfied with the DHS proposals, that they would "satisfy legislative requirements" from early 2015. How does this square with Wilson's evidence? Again, Wilson says she believed averaging was not being used.

Wilson involved in decision to get Anne Pulford to produce a 2nd set of legal advice. Why not just use the 2014 advice?

Wilson: "Well, to understand, is there any situation in which it would be lawful? Could it be used as a last resort. What's the support for such a practice"

Greggery: "So even putting to one side your murky understanding of what had changed and when and whether you knew income smoothing was happening or not, you very squarely knew that in your response to the ombudsman" its use was a Very Bad Idea. Yes, Wilson agrees.

Greggery: "But the language that you use in this response to the ombudsman tends to justify the continued use of averaging."

Wilson first tries to weave a little then adds under follow-up from Commissioner: "That's how it reads, yes."

Commissioner Holmes, frustrated. "It's not a last resort in fact or in description. Look, how did this happen?"

Wilson: "I had no visibility of what was occurring."

Commissioner: "Did you think if it was only a little bit it would be alright?"

Wilson: "I felt quite removed."

Commissioner: "There were hundreds of thousands of recipients of this. It was a massive program. It was supposed to recoup $1.7 billion. How removed could you be when you're the Deputy Secretary of department responsible for policy?"

Wilson: "And that's something I asked myself all the time now, Commissioner."

Commissioner: "I do just wonder if there is something you are reluctant to say about it."

Commissioner: "Are you being as frank as you can? Because you're not in a department now. You don't have to be tactful or diplomatic or preserve people's feelings or reputations or anything else. So you can be as frank as you like. You're privileged in what you say."

Back to, difficulties in the dynamic between the two departments that "did not engage with us thoroughly."

Wilson: "I wonder, in hindsight, to what extent there was good faith in terms of the assurances I was given."

Wilson corrects herself: "I was focused on the minutiae of trying to fix... not trying to to fix, to assist DHS to overhaul elements of the scheme that were clearly the focus of the Ombudsman's inquiry."

Focused on trying to fix a mess? Assist. Assist an overhaul.

Greggery, did you just disregard the consequences of the lack of lawfulness and moved on?

Wilson disagrees.

Greggery: "You kept them in mind, but you didn't do anything about it."

Greggery: "You had the opportunity to do something about it, and you didn't take it, disregarding the consequences to those who were the subject of the unlawful scheme."

Wilson: "I could have acted on it but I didn't. I took no steps to stop it."

Hoo boy. Wilson admits it again.

Greggery: "That means that you did that with actual knowledge of the consequences of the raising of unlawful debts on a large scale."

There is a veeeeeeeeery long pause.

Wilson: "I took no action."

This is actually very hard to watch.

Greggery: "You could act consistently with the code of conduct which applies to you as an Australian public servant and give full and frank advice or you could go down the road of doing things, taking steps which ensured the continuation of what you then believe to be unlawful."

Wilson: "I could have done something then."

Greggery: "You were duty bound to. You were supposed to act with integrity. With honesty. [Yes] You're supposed to give formal, frank advice. [Yes]. You breached the code of conduct by your deliberate choice."

Wilson asked about the new advice. "I did not seek the legal advice in order to justify the scheme. I genuinely sought the legal advice to understand: Is it lawful, is it possible?"

Greggery says he is being very clear: she chose to act in a way that "projected [its] validity".

Looking at McGuirk's notes from the meeting with the ombudsman on 16 January 2017. Here Wilson is noted as telling the ombudsman not only that nothing is wrong with the scheme but "paints a very different picture to your admitted knowledge of unlawfulness the previous day."

Remember they had a meeting on the Sunday between DHS and DSS on the Sunday to brief Serena on what was happening with Ombudsman. The Ombudsman meeting was the very next day. The first meeting: Wilson knew problems, the ombo meeting: all good.

Wilson and Pratt meet with Minister Morrison 22 January 2015. Wilson goes on leave the next day, returns 8/9 February. Greggery notes that by the time she had come back, DHS seems to have got some support from Min Morrison for the proposal.

Greggery notes that Wilson says between between her first statement and her supplementary statement, after reading some emails, that a recollection was triggered and she now remembers a conversation she had with Malisa Golightly back in February 2015.

Greggery: "My suggestion to you is that what you [state] is not recorded in any document anywhere?"

That's correct.

Greggery: "There's no email, you haven't been able to find the unidentified DHS officer who was present."

Correct.

Greggery says he is not suggesting this is a false memory, but he is suggesting it a memory she always had. Including when she drafted her first statement, which does not mention this meeting.

Wilson: "It was in my office and I believe that Ms Golightly came with somebody else, or at least another officer but I can't recall the specifics of it." She did however express a "bottom line position" in terms of no change to way PAYG income assessed and debts calculated.

Greggery: "And according to your recollection, Ms Golightly tells you that Min Morrison expressed his interest in the PAYG proposal but communicated to her that it was difficult to pass legislation through the Senate at that time."

Wilson: "There were a number of measures that were blocked in the Senate."

Well, yes, Greggery says.

So Golightly and Wilson discuss, in Wilson's office according to her recollection, a way they could do "increased PAYG income matching in a way that did not need legislative change."

Greggery: "So how could that work?"

Wilson: "Scaling up."

Wilson: risk profiles, selecting records more quickly, moving to a digital system that supported the process of correcting information.

Greggery: "You mean recipients correcting apportioned data?"

W: "I mean, recipients providing what information they had to correct."

Greggery: "You're having a discussion about how this PAYG proposal, which you know requires legislative change and is inconsistent with Social Security policy, could be implemented without legislative change."

No, it was about ~a~ PAYG proposal, Wilson says.

Wilson: "It was about 'can we find a way to do more of this that does not transgress or undermine the DSS concerns'. Is there something possible here? So what I undertook to do, having pressed that income smoothing could not be part of a design..."

She mentions again that the customer had to have plenty of opportunity to correct the record. And again Greggery says, what record? PAY data, she says. Well, Greggery responds, that implies the PAYG data has been apportioned in a way that requires correction.

This is a KNOT.

Greggery: "And the advice was the reason why you're having this conversation: there is a clash between the DSS position on advice on a written proposal and the will of the minister. Correct?"

Wilson says yeah no nah sort of.

Greggery: "You essentially acquiesced to the proposal going up [to the MO] marked 'no legislative change required'."

Wilson: "That was not my intention."

Greggery running through list of all the milestones on this disaster of which Wilson was aware: the budget measure, the mid-year economic updates, the media attention late 2016, the ombudsman inquiry, briefing ministers following media etc.

She is being placed at each milestone

Greggery: "You were never under any illusion that what was implemented in the 2015 budget measure required averaging in order to achieve the scale of debt raising and recovery."

Wilson: "I was foolish."

No, he stops her. It was more than that.

Greggery: What you did, was not consider anything other than ways "it might be possible or obtaining legal advice about that hypothetical proposal and letting things roll on through to the budget measure without telling the Minister about it."

Now to the mid-year economic update conversation she had with Murray Kimber in late 2015.

Wilson: "He quite appropriately queried whether DSS should be raising any concerns with the Minister about the MYEFO proposals."

And did you understand that to relate to the inevitability it must involved income averaging.

Wilson: "Noooooo."

Greggery: "Well why would he be concerned about a budget measure otherwise?"

Some pauses here.

Wilson thinks Murray was raising concerns about the fact the $1.7bn projected savings could not be achieved without income averaging. So, emboldened by this support from Kimber, did you do anything about it?

(The answer is no)

Greggery: "But irrespective of your belief, you have a relatively senior officer in your department, asking you for guidance about something they are concerned about, and your guidance as deputy secretary was to say 'we're not raising it'."

Wilson: "Yes."

Greggery: "You understood from your earlier conversation with Ms Golightly that it would be a pointless exercise because it was already underway. Legislation couldn't be changed. The departments had committed to the government that it would happen."

No, she says.

One thing probable at this stage is that this RC will recommend the two departments (delivery and policy, Services Aus and DSS) be merged. Wilson keeps saying she had no visibility of what they were doing.

Wilson vaguely recalls telling DSS Secretary Finn Pratt about her conversation with Ms Golightly. "I was trying to make sure he was aware there was some work going on," she says. What work, Greggery asks. "It was more that DHS was doing some work in this area."

Greggery: "You also informed Mr Pratt
about the potential inconsistency between the advices provided to the ombudsman in early 2017 and the departmental position, and the language cleared by you which accompanied those advices."

Wilson: Didn't want him to be "blindsided".

Email Wilson to Pratt 4 April 2016 with attached table, identifying 5 measures considered by DHS for 2016/17 budget. Seems to be shown as evidence that these are things about which Wilson would typically keep Pratt informed.

Point 4: Under "enforcing welfare recipient obligations" it notes "recipients to verify and update ongoing employment income for self and partner." Over page, extension of the 2015-16 budget measure additional 750,000 compliance interventions. $1.64bn fiscal.

Greggery: "Did you understand at this point, income averaging was being used in those measures?"

Wilson: "No I didn't."

Solicitors grinning as Commissioner notes her main aim is to keep them happy with the exhibits.

Commissioner asks Wilson: did you ever give the 2014 legal advice to Christian Porter? No. Why not, when he was taking questions on it?

Wilson: "At the time, I genuinely didn't appreciate the extent to which it was occurring."

Wilson is done with testimony for now.

Mention here by Greggery that Scott Morrison's "representatives" might want to have cross-examined Serena Wilson, but timing hasn't allowed that. That may happen down the track...

Adjourned until 10am AEST.

Don't have much time to see/respond during the hearings but two notes here: We deal with witnesses sequentially. Clearly Greggery is not impressed with Wilson. But Robodebt required the inattention or obfuscation of many. There will not be a single "did Robodebt" person.

Secondly, somewhat more delicately, I am just making a note of proceedings like I would either online or off for my written piece. I am not the only journalist covering the RC by FAR, nor the best. Yes, the ABC are covering it. Everyday.

A final note on Justin Greggery KC, senior counsel assisting. If he ever gently asked me what I thought about something inoffensive like stamp collecting I would immediately be deeply concerned he had a great deal of evidence that I had previously defrauded Australia Post.

DAY NINE will kick off in 10 or so minutes. I'll be doing my best to keep this thread going but have written 3000 words this morning and still not finished so will be juggling a few odds and ends. You know the drill: @DarrenODonovan @lukehgomes @RoyceRk2 @beneltham

Former DSS Secretary Finn Pratt is on the stand now. Sworn in.

Finn Pratt has a number of times now suggested something that Greggery KC might do or show. Commissioner Holmes: "I don't think you need to help Mr. Greggery a lot. He's been doing fairly well so far. But thank you."

His recollection of the time and of Robodebt is "reasonable but not great" he notes. Greggery reminds him there was significant media attention from late 2016 which triggered inquiries, which themselves would have triggered meetings with ministers.

Pratt being asked about the "blurry" line between social policy at DSS and delivery or "operational policy" at DHS. He says "finding that demarcation point is difficult."

Pratt: "I think it is very important to understand that in no way, including when I was secretary of DHS, was DHS ever subordinate to the Department of Social Services, right, they were colleague departments that happened to be in the same portfolio."

Minister Christian Porter raised Robodebt with Finn Pratt. Very close to Christmas either 2016 or early 2017. He was getting media calls as acting Human Services Minister. (He was also Social Services Min at the time, Tudge was on leave).

Pratt says of this media attention: "I was quite surprised, for example, that the letters that went to people didn't have telephone numbers on them." He "must confess I did not have a real consciousness or understanding of income averaging."

Pratt used to be DHS / CEO Centrelink.

Commissioner Holmes: "Can I just ask you, as DHS Secretary, were you aware of averaging ever being used as a means of determining or raising a debt?"

Pratt: "No Commissioner."

Bingo.

Recollection of Porter chat.

"My paraphrase, I seem to recall it, Minister Porter might have said something in the order of 'what the hell is this all about'. I think my response was, 'you are reading the same media I am'."

Pratt remembers getting a briefing on the Australian National Audit Office (ANAO) little look-see in mid-January 2017 and yes, the Commonwealth Ombudsman was also investigating. Pratt doesn't recall being briefed by Wilson on legality of the scheme.

He says no, but it's likely she would have. Then rephrases: "I am sure Ms Wilson would have talked to me about the issues in relation to the scheme. I don't recall any discussion about legalities or issues of that sort."

Distracted! But we are going now to 22 January 2015 meeting with Scott Morrison.

Greggery showing a diary note belonging to Pratt. "I don't mean to be at all critical, but I can't read all of it." It indicates he spoke with Kathryn Campbell on 21 January 2015 (the day before meeting).

One note from the diary re: the meeting with Morrison just reads "Welfare cop."

Remember Morrison crowing about being a tough new welfare cop on the beat? Making that known, by the looks.

Pratt made a note "very progressed under 30s" which he thinks relates to the Hockey fuckery from the 2014 budget which would have required people under 30 to wait 6 months before being provided income support.

Missed that, but sounds like Morrison was quite enamoured with his Sovereign Borders asylum-seeker outsourcing to Angus Campbell (three star general, from memory) and considered something similar with AFP seconded in welfare.

Can't remember the saying but: remember how they treat asylum-seekers is exactly how they would treat us if they thought they could get away with it.

Notably, what is not read out there is anything about the early concept of what is now known as Robodebt. But there were many, sometimes daily, meetings between Pratt and Morrison. Adjourned until 11.40am AEST.

Finn Pratt being shown the 19 January email from Serena Wilson replying to the detailed summary of policy and legal advice sent to her by Andrew Whitecross three days earlier. She reiterates she was concerned and will speak with Malisa Golightly and "let Finn know."

Pratt says he does not recall any knowledge of the proposal prior to this point. "In fact, I wasn't even aware what income smoothing was," he says. Hmmmm.

Pratt: "Well, virtually everything to do with the Social Security system I left in the safe hands of Ms Wilson."

HELPFUL! He then clarifies he was, of course, engaged on strategic things.

This email re: the DHS policy proposal with significant and detailed policy and legal advice is the sort of thing that would have been raised with you, right?

Pratt: "Yes, I think that is right. And, frankly, the advice is excellent advice."

Having a gander at Exec Minute that went to Morrison on 12 February 2015 and which he signed on 20 February. It notes that, following his meeting with Kathryn Campbell (DHS) the dept was asked to provide update on current arrangements and options for "strengthening" compliance.

Jesus, language in brief from the dept is wild. They mention the creation of a new taskforce to "aggressively target fraud and non-compliance" for Newstart, DSP, Austudy, and Carers Payment recipients. "It will send an important message around the country that 'you're next'."

Editor called so I missed that last chunk of exchange but came back to Pratt saying he doesn't remember Morrison ever "discussing the debt or compliance measures with me."

The brief notes that both "operations" suggested, including clean-up of existing data and low-level non-compliance, can be done under existing arrangements but "would be significantly strengthened if the suggested policy and legislative changes are adopted."

Par 11 "recommends that the department (DHS) continues working with DSS to undertake the above analysis and develop a package of policy and legislative changes for you to take forward."

Sensitivities marked on the brief: "Welfare groups, advocates and other commentators have made public comment in the past expressing concern that increased compliance unfairly affects the more vulnerable people in society."

Pratt: "Commissioner, in my experience in the public service, It is almost always a stuff up I I cannot think of any examples where a conspiracy has been concocted by people to do something, deliberately."

Holmes: "OK, what about conspiracy to conceal a stuff-up?"

Pratt, on the February 2015 proposal: "It is hard to see how that could then be implemented without the legislative changes."

Greggery: "Assume that it did. How could that happen."

Pratt: "I don't know how that could happen."

I'm half listening. The tenor of Greggery's questions at this point is: you'd expect to see a trail of documents and evidence that shows how it either went ahead WITHOUT legislation (which it did) OR how it was changed to make it OK. We have neither.

Commissioner Holmes makes a very good point that even if they did change the legislation, they couldn't retrospectively remove entitlements from people from, say, 2011, when the law was very clear they were entitled to them. Nor constitutionally, Pratt notes.

Pratt initially says "I defer to your greater understanding, Commissioner" (not sure if he is trying to be an arrogant fellow, but it is coming off that way) and the Commissioner responds: "Well, it's not rocket science."

With a budget for May 2015 and a measure they wanted to start on 1 July that year, could legislation be done on time? "That would be impossible," Pratt says. Obviously, if there was a national emergency or something but this was not that.

Greggery: "Throughout 2016, that's the period you refer to in your annual report 2016-17 was your attention drawn in any way to questions about the lawfulness of the scheme?"

Pratt: "Not to my recollection."

And the ombudsman report? "From DSS's point of view, and I don't wish to diminish the significance of obviously, what happened with the Robodebt Program and the tragic consequences of it. Seriously, I do not, but in terms of my then context" he would have reviewed briefly.

January 2017 discussions with Kathryn Campbell, telephone call etc (time of ombudsman investigation) and a 30 January 2017 meeting with Christian Porter, then DSS Minister, where he doesn't recall this coming up.

Diary page from Pratt, asks if it is about to be public. Concerns? "No, this is just vanity. There's nothing that is cabinet... related here. I'm just not sure I want the world to see the lack of quality of my handwriting."

Holmes: be good if that is all you have to worry about!

Look, he's not wrong tho.

Pratt concedes the obvious that by 30 January 2017 he would have been aware of the Ombudsman's inquiry because he or his delegate at the time would have written to Pratt to inform him of the own motion investigation.

Email 25 Jan 2017. Pratt is mentioned. "in addition to Finn's request, we have been asked to provide dot points to the media in case we are asked." They note they will try shove off to DHS but if the "inquiry focuses on the legality of DHS activity we might need to respond."

Back from lunch. 23/24 March draft response to Ombudsman's report provided to Pratt to sign: "[The] department is satisfied the system is operating in line with legislative requirements and there have been no changes to the way in which DHS assesses PAYG employment income."

We don't seem to have a copy of the final letter Pratt actually signed.

Pratt confirms, however, that this phrasing was in the final letter her signed and which was sent to the Obudsman regarding its final report. Pratt did not take any steps to satisfy himself beyond being briefed.

"They would not have drafted a note for me to sign that if they did not feel that that was the case," Pratt says when asked if his Department believed its advice to him.

Pratt: "Ms Wilson is one of the finest public servants I've had the privilege of working with. She was highly intelligent, highly expert and highly ethical. I trusted Ms Wilson implicitly in the advice she gave me."

Pratt doesn't want to take too much responsibility here. There is a huge caveat: "My view is, if I think people have discharged their responsibilities in good faith, then I take responsibility as secretary."

Greggery: "At any point, did that fundamentally obvious flaw come to your attention or become apparent to you?" Lots of talk here but short answer is: not really.

Lol Pratt's letter to the Ombo with his signature is in the final report (should have remembered that). We are satisfied everything is hunky dory. [Ron Howard narrator voice: it wasn't.]

Commissioner: "There were cases in the AAT, which said that averaging was not a legitimate basis for raising debts?"

Pratt: "I know that now, yes."

Commissioner: "You didn't know that at the time?"

He says he does not recall being aware.

Pratt: "It was not a priority for me. I would have been spending 60 to 70 per cent of my time on the NDIS. We were working on the Redress Scheme in response to the [child sex abuse] royal commission."

And here we are, at another royal commission. If only there was a way...

Commissioner: "You'd have appreciated your obligation to give accurate advice to the Ombudsman?"

Pratt: "Yes."

Commissioner: "But you didn't ask to see any legal advice to that effect?"

Satisfied with briefings from staff.

Commissioner: "What did you actually ask? Did you ask, what are you doing, what is the DHS doing, what is this program, what does it consist of?"

No.

Commissioner: "And you didn't say to your own department, to your own deputy secretary 'did we get some legal advice on this Could I have a look at it'?"

No. Again, focused on DSS stuff.

Pratt: "Now I'm not trying to shirk responsibility here. I am not trying to blame DHS."

Pratt, getting a little brisk: "This was one headache that was not my headache!"

Pratt: "Commissioner, I would sign many, many things on behalf of the Department. I had to be trusting of the advice. I am not able to do the job of all of my staff, I had over 4000 people working in DSS over that period."

Pratt: "I was heavily involved in the NDIS."

Commish: "You told us that."

Pratt: "I have told you that. The NDIS was all-consuming. It was all consuming."

I detect a hint of panic in our man Pratt here.

Commish: "Your department was responsible for policy and it was evident that whatever was going on, was creating havoc for hundreds of thousands of welfare recipients. It wasn't an issue sufficient to attract your attention?"

Pratt: "It was their [DHS] issue."

Commish: "What's not clear is whether your department gave the legal advice it had in 2014 and the policy advice it had in 2014 to DHS."

Pratt: "I don't know but I would be amazed if they were not communicating their views to DHS. That would, that would make no sense."

I suspect Commissioner Catherine Holmes has seen her fair share of powerful men avoid responsibility. This is a dogged and clarifying line of questioning from her.

Greggery: "And so this whole scheme occurred over a number of years while you were the secretary without your knowledge that it was unlawful?"

Pratt: "I don't believe that I had known that this was an unlawful scheme until that court case [class action] several years later."

Pratt: "Mr. Greggery, if you are suggesting to me that there was some form of conspiracy amongst my people to dupe me, I refuse to believe that."

But Wilson gave evidence yday she knew it was unlawful in 2017 and did not tell Pratt, Greggery reminds him.

Pratt: "I don't, I don't accept that."

Greggery: "You couldn't comprehend that that could be right given your knowledge?"

Pratt: "I just don't believe that is true. I cannot imagine why Ms. Wilson would accede to that."

We get philosophical here.

Pratt: "Why would she not tell me? I don't understand, what would be the motivation for not telling me?" There is a searching, almost desperate inflection to that line.

Greggery: "So knowing that what has occurred in 2015. is DHS and Minister Morrison introduced a budget measure without a caveat that required legislative change, and it was automated in from 1 July 2016, how can you explain... that that would happen without your knowledge?"

Pratt: "Well, I expect that there would have been a confluence of miscommunications and mistakes, that sort of thing."

Greggery: (I'm paraphrasing) involving EVERYONE?

21 January 2015 email from Wilson to Pratt. This provided over the lunch break. Pratt: "This is the first I've seen of it since, uh..." he trails off. He hasn't read it yet.

Suspense.

"Clearly Ms Wilson's notekeeping is better than mine," he says after reading it.

Wilson's email, subject says "urgent and important products / comebacks for minister". Then: "Finn and I are reconvening with Minister tomorrow at 9.30. I have some things below that I'd like done for that meeting, please."

Wilson's point in email: "He [Minister] also asked for DHS compliance activity and hit rates, tip offs. Data matching, DHS is to do but we should try and get a copy of it."

That suggests that there was a meeting with the Minister prior to the sending of this email either on the morning of the 21st or previous day. Which is a day earlier than the 22nd Jan meeting we DO know about.

Greggery: "It's the ministers indication of some interest in it, which means that also now it is of interest to you."

If Morrison wants to know, Pratt now has to know.

Pratt: "I think that's a fairly weak link."

Greggery: "And what we know is that from the... executive minute 12 February 2015 was that whatever the proposal was in respect of data matching, and we've been through it required legislative and policy change, from then drops off your radar until December 2016 or January 2017."

Greggery, cntd: "And from that point on your department's representations to the public, and those inquiring, is that all of this is lawful when that is not the case."

[tugs at collar]

Another email, not copied or sent to Pratt but he is mentioned. 25 January 2017 incl. Cath Halbert and DSS colleagues. Refers to an attached ministerial submission which relates to the interest charge measure. Went to MO that evening.

A point in this attachment: "How many of the 200,000 data was related to people issued with debt under the online compliance intervention measure?" And then there's a note. It gets forwarded to DHS with request for an answer to go back to DSS to brief Min.

Pratt being shown a brief which has the answer to this question. It came from the DSS management system, he doesn't seem to have any notes on this briefing. Do you recall seeing that?

Pratt: "No."

Adjourned temporarily, although he is done for evidence for now.

And here comes Kathryn Campbell. Late in the day.

Campbell: "I was aware of the raising of debts but not a detailed knowledge of it. I was aware that that was a departmental responsibility but there were, during that period between 35,000 and 40,000 people within the Department of Human Services."

Campbell confirms she worked with Malisa Golightly on the Feb 2015 executive minute / brief that went to Morrison's office.

Greggery gets her to agree to different basic steps then: "And you're aware, ultimately, the proposal in the form that it was given on 12 February 2015 if it was to be implemented as a budget measure required legislative and policy change."

Yes, but DSS told us that

Wow.

Campbell: "We had left that to the Department of Social Services with responsibility for the legislation. I had not subsequently seen the details that were finally agreed by the government in the lead up to the budget."

Campbell, of the budget measure:"And so, I, in my role as DHS at that time, I don't recall where that landed."

Well, when did you figure out where it landed?

Campbell: "And so I don't recall having any discussions about legislation with respect to this measure.

Campbell: "I don't recall any interaction with Mr Pratt or any other SES officer." Says she looked at emails and other documents and has not discovered any evidence to that effect, that she did discuss.

Aaaaaaaaand doesn't recall any discussions with Golightly between the brief in February 2015 and the May 2015 budget when it was announced as a measure.

Campbell, repeatedly: we left it to DSS, the brief says we would continue to work with DSS on the proposal. And did you? Can't recall, she says. She did not ask for legal advice. It was not brought to my attention. I was not aware.

Being shown the brief to the Minister which references a meeting with Morrison, Campbell recalls! It was 30 December 2014. She had returned from leave to Sydney from Brisbane to brief Morrison.

Senator Marise Payne was going on leave so she offered that Kathryn Campbell would do her job in briefing Morrison regarding DHS stuff, which usually comes from the junior minister.

Morrison asked for this brief during that 30 December 2014 meeting. The request she doesn't recall in specifics but says it was about the role of DHS in "protecting the integrity" of the welfare system.

This is important, Campbell says she did not have any specific plans or proposals to give Morrison in that meeting. Those came up in the brief.

Campbell did go away and met with executives in DHS on 5 January 2015 about some ideas. Malisa Golightly was at that meeting but Campbell can't recall what, specifically, MG might have said. (For instance, if she said 'hey, we have some concepts you might like)

Of course, the DSS advice had already been provided weeks before that Morrison meeting on 30 December.

I am a little quiet as trying to listen, read a page proof of my piece for this Saturday and simultaneously edit it to include the latest testimony but Campbell is being pressed about the representations made to Morrison in the brief. "That was advice provided by Ms Golightly."

Greggery: "Do I take it... that there is a step in the calculation that there is some comparison between the PAYG data and the income thresholds [for entitlements] under the Act?"

Campbell: "Yes."

[and how might they compare that data to the fortnightly blocks in Act? Avg].

And there we are, adjourned until tomorrow 10am AEST.

DAY 10 of the Robodebt Royal Commission kicks off soon. I've gone for a 4km walk, done a half hour interview, another 2km walk, have a coffee, Kathryn Campbell is continuing from her brief appearance yday. This will, I suspect, be very interesting.

Resuming with the 12 Feb 2015 executive minute that went up to Minister Morrison.

Part that says the proposal removes the need for DHS to "be dependent on customer and business information." Greggery: "This represented a significant shift in the approach taken to reliance on PAYG from it being one of a number of factors to it being a trusted source." KC: Yes.

Campbell: "So my understanding is that the calculation [of a discrepancy] occurred after the recipient had the opportunity to update the data." Campbell: Discrepancy in ATO data -> given to recipient -> if recipient updated data then "discrepancy calculated at that point". Hmmm.

Campbell: "The intent of the system was that a recipient would be presented with that difference [zw. ATO and DHS] and asked to provide further information or identify whether there was an issue." She frames this as an happy little prompt.

Greggery presses on this: "Though at all material points in the proposal, there was the transfer of the investigative responsibility from DHS to the recipient." Campbell is being evasive here. Doesn't want to agree with this assessment, but also not saying "no".

Greggery: "The point is that in the previous system the obligation was on the compliance officer to obtain and assess available information before making a decision."

Campbell: "Yes, but that information could have been sought from the recipient."

Greggery: "Yes, but it's only one potential source of the information, there were others available as you identified yesterday."

Campbell: "Yes."

Phew, got there in the end.

Greggery: "At no stage in the previous manual system was there the raising of the debt by bare comparison between the numbers on a PAYG data summary from the ATO and income reported by the recipient."

Campbell: "I don't think I could say that conclusively."

Greggery points out that the operational blueprint required evidence of an actual debt before one was raised. Campbell, helpfully, has not reviewed the operational blueprint "in recent times." But he says the minute refers to it being more than just a "trigger". Camp: yes.

Remember, this Exec Minute was worked on very closely by Malisa Golightly AND Kathryn Campbell. She would have been intimately familiar with the shift in policy this represented, because they spelled it out as much.

When she is presented with detail in the minute as proof she knew, she walks back yday's evidence: "I had, I'm sorry, I had given evidence that I had cleared the documents so I accept that this is the document but this is not a document signed by me."

Greggery: "Yes, but I keep coming back to something that I don't think you are accepting now, which you previously accepted. That was the first part of the change of the debt calculation process involved a transfer of an investigative or evidentiary obligation."

Campbell: "Yes. My only evidence that I was putting on the position was that in the past we had also asked customers to provide information."

Going around in circles here.

Now to next dot point in brief. Looking at the assumed $1.2bn gross savings and debt and 870,000-odd interventions. Greggery says the only way this could have been realised was by the shift in onus on to customers. Campbell: "That's correct."

Next par deals with the Single Touch Payroll which was, at that stage, a project underway but some years off full delivery. Yes. Final dot point: DSS advise legislative change needed, may need to change policy with ATO. We will continue to work with DSS.

Greggery: "The fact that DHS had received advice from DSS that legislative change was required... reflected both the shift in the evidentiary obligation to the customer and the evidentiary significance of PAYG data in calculating a debt on income earned in fortnightly periods."

Campbell: "So it is not clear to me that both of those elements were in DSS's mind when they suggested legislative change was necessary."

Greggery: "Are you saying, as sec'y" that you drafted a minute without actually knowing or understanding "relevance of legislative change."

Campbell: "It was not my responsibility to draft or advise the minister on that legislative change. This was a proposal that asked the Minister whether he wanted to pursue this."

Greggery: "I'm not talking about who is responsible for what, I'm talking about your understanding."

Campbell says they "did not articulate" what legislation was required. Yes, but that's not an answer.

"I had not turned my mind to which parts of the legislation would need to be changed because I was not responsible." Again, not what Greggery asked.

Commissioner: "Wouldn't this effect your Department, the fact that legislation had to be changed? Wouldn't that be something you'd want to know about?"

Campbell: "It would affect our department."

Commissioner: "So wouldn't you need to know?"

Commissioner: "So what were you going to do, sit back, see how it changed and then worry about it then? It's the lack of curiosity about what that legislative change might entail in circumstances where it would unquestionably affect the operations in your department."

Campbell says "in hindsight it looks like a lack of curiosity."

Campbell acknowledges "we could have" attached the legal advice to the executive minute but says at this stage "it was still quite preliminary." Greggery: "You could have asked Ms Golightly for a copy of the advice, that's all you had to do."

Campbell agrees the brief could have been suggesting all the legislation had to change, purely because she does not "recall" what was actually required. In 2017, Campbell says DHS told her they had changed their mind and legislative change was no longer necessary.

Greggery: "Who told you that?"

Campbell: "I can't recall."

But then she mentions the 2017 Pulford legal advice which they gave to the Ombudsman.

Greggery: "Between Feb 2015 and the announcement of the measure in the budget, what steps did you take to ascertain whether legislative change and further DSS advice had been obtained?"

Campbell: "I don't recall taking any steps."

Greggery: "Would you agree that the Department of Human Services was at this time, an independent department of state over which the Secretary of the Department of Social Services had no control or responsibility?"

We were independent, she says.

But adds there were many delegations where they handled payments for other areas (Medicare for Health, payments for DSS via Centrelink etc).

Greggery notes that the concept of delegation just means people exercises their own capacities to do what they've been delegated.

Yes.

Greggery says delegation didn't detract from DHS's ability to do its job. No, Campbell says.

The upshot: proposal was a significant change in approach. Yes, Campbell says. And the change in approach from using PAYG data as one factor to giving it primacy for calculation of debts was also significant? Yes, Campbell says.

Campbell told she gave evidence yesterday about various drafts of this Exec Minute she worked on with Golightly. Now being asked to look at a document that is a "late addition" to proceedings.

I wonder what it could be!

15 Jan 2015 email from Golightly to Campbell with attached proposed brief to be sent to Marise Payne. It appears to be the first draft of the brief that eventually went to Marise Payne that eventually went to Morrison as the 12 Feb 2015 brief.

This is 10 days after the January 5 meeting Campbell had with her leadership team to "debrief" stuff Morrison was after. This appears to be a very early draft, then.

This draft par identifies "the core issue of the difficulty in ascertaining actual fortnightly income to determine overpayments" by reference to annual data from the ATO. Campbell agrees this is what this indicates.

Greggery: "And so it was always understood by yourself, that the question remained that when a debt was raised, of central importance was the allocation or proof of actual fortnightly income in the fortnight that a recipient received a benefit."

Campbell: "Yes."

How's that for some state of knowledge!

Over the page, Campbell asked to read the drafting under "background." Par 19 addresses two points: potential for stock of payments already in the system that have "likely been paid in error." That's the $1.2 billion figure in the Minute.

Second point: "The concept of addressing that in a cost effective manner would require reconsideration of the policy and legislative constraints, income has to be determined and upload fortnightly instead of using the data available from the ATO, on an annual basis."

Greggery is using this pin Campbell on the fact she understood this was about using annual tax data on a fortnightly basis. Which is a simple step to: knew income averaging was being proposed. Adjourned for 15 miniutes.

Back, about to show Campbell another version of the draft brief which we haven't seen yet.

This a draft with Marise Payne's handwritten notes for consideration. Campbell says she can't say if it is Payne's writing, She can't recall if it is Golightly's writing either. Golightly sent email 10 Feb "I've attached scanned version of the Minister's [Payne/s] comments."

Mostly little changes by Senator Payne it would appear but on the matter of Par 9 re: the proposal she writes "debt??" which appears to have been incorporated in the final brief to Morrison.

Re: the broader compliance crackdown measure the original message to welfare recipients was that they could be next but handwriting has crossed this out and replaced it with the "you're next" which made it to the final brief. Attention to detail warms the heart.

Campbell says she was aware of costing of the measure for budget with respect to DHS outlays, but not the $1.2bn figure "because that was costed by the Department of Social Services."

Reference to a secretary brief in an attachment to some emails. This is on costings. Another attachment had the Excel spreadsheet with the numbers in it. Process suggested by email: would come to Campbell for approval or clearance, then forwarded to Department of Finance.

Finance would either agree or disagree, then a negotiation would follow if there was disagreement. The negotiation involves what aspect?

Campbell: "Every aspect." Staffing, funding etc

Another email that Campbell sent headlined "for clearance and finance costing for options one and two of the strengthening the integrity of the welfare system proposal."

Campbell wrote: "I will ring Finn tomorrow to alert him to the issue."

And what was the issue?

Campbell: "My recollection is that the Finance Department were looking for a cheaper option with lower departmental costs." And why chat to Pratt? Because Payne was not a cabinet minister. Morrison was.

Campbell: "Minister Morrison was the portfolio minister, and this would have been part of the portfolio budget statement, which he had leadership of." In fact, she said, he had leadership of ALL portfolio measures.

Halloween is over but Greggery says: "I have a document here which I don't, it doesn't appear has been tendered."

Someone whispers in his ear and he says "I understand why it might not have been now" and then abandons the plan. No!

Campbell being shown 1 May 2015 document. Email from Ms Ahma (sp?) where she says "Kathryn please find attached... revised costing." Reflects agreement between ministers' offices (Morrison, Cormann, Payne) and Golightly has approved. Finance wanted it approved that night.

Campbell: "My recollection is Finance would have wanted lower money and lower staff numbers. We got lower money and lower staff numbers than we originally asked for."

Greggery: "Do you recall seeking or being informed of legal advice about the question of the use of PAYG data as evidence of actual income for fortnightly periods... prior to 1 July 2016 when automated system rolled out?"

Campbell didn't seek: "I did not become aware of any."

Greggery: "Does it follow from that answer that your understanding was that legislative change was required for the proposal at that point, and it hadn't happened?"

Campbell: "No." Thought there had been a change in view it was no longer required. Did she see advice for that?

Campbell: "I don't now recall how I had that view."

Campbell was not DHS secretary for three months in 2016 but when she came back in August, did she ask for any advice or seek assurances the scheme was operating within legislative requirements per brief? "No, I did not."

It seems convenient, to this humble bystander, that Campbell knew for sure that the brief said legislation was required but seeks no advice on this and that, when the scheme starts, she has a belief Robodebt was operating lawfully but can't remember why she thought this.

Given all of this, Greggery asks, why did DHS have carriage of appeals to the AAT on Robodebt cases, and challenges brought in Federal Court where DHS was the client instructing the Australian Government Solicitor. Campbell says: "In consultation with DSS."

And it was Services Australia, Greggery notes, that raised the brief with the Solicitor-General which provided that crystal clear advice in September 2019.

18 September 2017 is the date Campbell was appointed secretary of the Department of Social Services. Campbell accepts questions of legality re: Robodebt were "significant" in the media and elsewhere by late 2016.

Campbell: "I had in my time in [DHS] focused on improvements to the system to meet what I understood to be the legal issue, which was: give recipients the opportunity to respond to the material and by Sep 2017, this was not the main issue I was focused on in Social Services."

Hindsight gets another walk outside its cage!

Campbell: "I accept that, given the Solicitor-General's opinion that we had been working on a false premise, that the work that we did in at the start of January, 2017 did not change that opinion... the legality."

Campbell, re: 2017 ombo. "I was advised then that DSS had received legal advice, that there was no requirement then to make changes to the legislation. And that's the premise, I then worked under for the next couple of years." Greggery challenges, it was NOT a false assumption

Greggery: "You had actual knowledge" of the transfer of evidentiary obligation to the recipient and "you had actual knowledge" that annual PAYG data was being used in fortnightly reporting blocks. Yes and yes, Campbell agrees.

Greggery: It follows from that, that your assumption reflected in the draft on 15th January 2015, and the final on 12 February 2015 had no basis to change."

Campbell: "It had no basis to change."

Another "on reflection" which is the prettier cousin of "in hindsight".

Greggery: Well, can I suggest to you the reason you didn't turn your mind to it, given the fact that you didn't know... was because the Minister had given his support for the proposal. It had made the budget, and the costings had been done."

Greggery continues: "And your responsibility was just to implement it, regardless of the legality."

Campbell: "No, I do not accept that."

You made reference to the fact it was used as a last resort but that had no practical effect, did it, "whether it was a matter of first resort or last resort if income, actual income, was being calculated by reference to averaging from PAYG summaries."

Campbell: "I could have been influenced by the fact that this had been a practice in the Department of Human Services and its predecessor organisations for many years." Or she could have been influenced by actual knowledge from 2015.

Greggery: Do you recall a
conversation in early 2017 with Ms Golightly and Ms Musolino (chief counsel) in relation to the question of whether DHS would obtain legal advice as to the lawfulness of the income compliance program?"

Campbell: "I don't recall that conversation."

Greggery: "You had actual knowledge that it was probably not lawful in early 2015 and in 2017."

Campbell: "In 2015, in the briefing that was signed, it was that DSS had advised that we would need legislation."

That is: not lawful.

Here we go: Greggery says "that reflected your actual state of knowledge about the question of legality or otherwise at that time."

Campbell: "The state of my knowledge was that DSS had advised that legislation was needed. I had no reason not to accept that advice."

Greggery: "Sounds like you are also passing responsibility to the Minister for what they did with that advice, rather than bearing it yourself."

Greggery: "Why is it that when you considered the question of whether the DHS should obtain legal advice in respect of the lawfulness or otherwise of its implementation of the program, in early 2017, that you decided not to?"

Didn't want competing legal advice from DSS.

Greggery: "It would have been of crucial importance to you as the administering entity with legal responsibility in respect of the lawfulness of the scheme to have your own position on it?"

Campbell: "That's not how legal advice always works in the Commonwealth."

Well, why didn't you go to DSS and ask first, because that is entertained under the legal services directive?

"I can't answer that," she says.

Going to become the Mayor of Hindsight so that everyone who lives in Hindsight can live our their perfectly orchestrated lives and I will die a hero.

Being shown annual reports that Campbell signed off in her capacity as secretary. 2015-16 and 2016-17. Lots of appendices re: data-matching and privacy safeguards and numbers and assorted annual report-y things are being read out as a scene-setter.

In 2015-16 report, social welfare compliance activity table. Compares to the previous FY. Debts raised 2015-16: 210,009. Total debt value: $694.6m. Footnoted: introduction of the strengthening integrity of welfare payments bud measure increased focus on "historical overpayments."

Campbell says she has no knowledge of whether the data was obtained under the Data Matching Program Act or a guideline.

Hindsight, on the stand: "With the benefit of Kathryn Campbell, I understand that I will be making only excellent decisions from now on."

Anyway, in the next FY annual report the reference to the Data Matching Program Act has been removed and now mentions "for over 10 years, the Department's data matching processes ... carried out in accordance with the guidelines on data matching." Hmmmm.

Greggery: "Your evidence today is that the way income was assessed, changed."

Campbell tries to add a caveat about "when people did't respond" and he pulls her up: "No, that was not your evidence."

Back to the two significant changes Campbell accepted earlier in her evidence which remained core features of the program. Campbell: "And another core feature was the ability of the recipient to provide information." She says the annual report "may be inaccurate."

Greggery: "It's misleading, isn't it?"

Campbell: "I now review it, see that it should have been phrased differently."

Greggery, again: "It's misleading, isn't it." She struggles.

Irrespective of the information a recipient provided, Greggery says, it was only taken to have greater weight than the PAYG data where it explained "direct income" in the fortnight, correct? Correct. "Otherwise the PAYG data was applied, correct?"

Greggery: "I think what I understand you to say is despite your earlier evidence... you don't accept that this sentence is misleading."

Campbell: "I do accept that this sentence is mis... is not optimal."

G: "It's positively misleading!"

Greggery: "Ms Campbell, you did not give that evidence looking back now, you gave it according to contemporaneous records which recorded your actual knowledge in 2015." She is unsure what she thought when clearing the annual report in 2017.

Campbell refuses to accept it is "positively misleading." She accepts that it was incorrect, drafting could have been more accurate.

Greggery: "The drafting was very careful, I suggest" because it was included to protect the Dept's position with respect to controversy.

Campbell does not accept this characterisation.

Greggery: "This was a very carefully drafted representation of the defence of the ongoing lawfulness of the scheme and the accuracy of its calculation of debts, correct?"

Campbell: "I'm not sure we deal with lawfulness."

Campbell repeats that she was labouring under the premise that it was all about participants being able to respond which is why her staff thought she was "fixated" on making sure this happened. Her words.

Back to the brief to the Ministers as a little reminder of just what was proposed (ie: those two significant changes she has already accepted). These both include customer having an opportunity to respond prior to the debt being applied.

Campbell asked about another line that said customers could provide info "if they choose." Which means they could choose not to. "Sometimes customers chose not to because it was advantageous to them not to," Campbell says. Greggery bites: Was that the only reason? No.

Little hint at her worldview here: the welfare recipients are trying to rip us off and we need to collect that debt.

Greggery: "It's really important you listen to my questions, Ms Campbell, because you are not responding to them."

Greggery: "You gave evidence that it was the advice in 2017, which said because the customer was provided with an opportunity to update their information, that meant that the system was lawful."

Campbell: "That may have been my interpretation of the advice." Exactly!

Greggery: "And my question then is given that was already a part of the proposal, which you referred to on two occasions in 2015, which you understood, legal advice was said legislative change was needed to do that. How could you reconcile your understanding?"

Greggery: "They are plainly inconsistent!"

Haven't seen him this worked up at any point in this inquiry.

Very long exchange now which is essentially Campbell admitting she didn't understand what parts of the Act / law were being used to carry out elements of Robodebt. Or, for that matter, regular admin of social security.

Commissioner: "On any aspect of this, did you look at the legislation?"

Campbell: "I can't recall."

Commissioner: "Look, burglars probably use the same practices over 30 years, it doesn't make them lawful."

[flames crackling]

Campbell is being roasted here. Slowly, but roasted nonetheless.

Campbell: "There was no way I could have been across all of those operations." It's a very big department, she says, you wouldn't believe how big! Big as the sun, perhaps, who can say.

Commissioner: "So how does this sort of situation get resolved if things are failing at many points of the program, and things are being done illegally. How does it ever get overseen and prevented if the Secretary is always too busy to attend to it?"

Commissioner: "But if you say there was a lack of clarity about who was getting legal advice it's simply because you didn't ask, isn't it, you didn't ask the question."

Campbell says she didn't ask but "had an expectation."

Greggery: "There was no doubt in your mind that your department had responsibility for ensuring that it administered the program lawfully."

Campbell: "Yes."

G: "Given there was no uncertainty, how can you say there's confusion about whose responsibility it is to get advice?"

G: "There was nothing to stop you getting the advice."

C: "I would have needed to talk to DSS as the administering entity for the Act."

G: "You wouldn't have needed to talk to DSS... your dept got external and internal legal advice on 100s of matters without consulting DSS."

Campbell: "I have no evidence of that."

Greggery: " Are you saying you never did that?"

Campbell: "No, I said that I don't have evidence to that effect."

Greggery: "In 2016 your assumption about legality was fundamentally flawed."

Campbell says she knew that in 2019. And in 2017, DSS advice made her assume it was fine.

G: "That is a big assumption to make."

Back to the "but it's a very big department, your honour" defence.

Greggery: "Would you describe the robodebt scheme implemented under your secretary-ship as a massive failure of public administration?"

Campbell: "I consider it was a failure of public administration on a mass... on a significant scale." Can you think of a bigger one?

Campbell: "I have been involved with other significant failures. And there have been other significant failures, but I don't think that it's useful to talk about those."

What a note on which to adjourn.

Campbell has to go now (sad) but will be back on 5 December, if I caught that right.