official says she didn’t tell Scott Morrison the scheme might be illegal

A former senior Department of Social Services official, who received damning legal advice that the robodebt scheme was illegal, told a royal commission she lacked the ‘courage’ to speak out and that she was now “ashamed”.

In dramatic hearings on Wednesday, the royal commission was told Serena Wilson, a former deputy secretary of the DSS, was told about the legal opinion in early 2015 when the program was conceived.

But she said she had not personally told former Prime Minister Scott Morrison the plan might be illegal as she believed he had already been “killed”.

Wilson then claimed she was unaware for about two years that the illegal ‘income averaging’ method was being used in the robodebt scheme, saying she had received assurances from another official , Malisa Golightly, since deceased.

Wilson said she finally realized the illegal method was being used in the “last part” of 2017, but didn’t have the “courage” to tell anyone.

“And now I’m ashamed. And in hindsight, I could have spoken,” she told the hearing.

The robodebt scheme – which began in July 2015 and continued until it was stopped by the courts in November 2019 – saw hundreds of thousands of Australians send in illegal claims for social benefit reimbursement and ended in a $1.8 billion settlement.

Wilson received an email from a DSS official in November 2014 saying that a legal opinion was to confirm that the “revenue averaging” method used in the robodebt program was illegal.

A January 2015 email also sent to Wilson began “you have requested information/advice on DHS’s proposal to change the approach to…increasing Social Security debt.”

Wilson, who was among the most senior people in the department, denied seeking the legal opinion, though she couldn’t rule it out.

The hearing was told that Wilson also found no record that she passed on the legal advice to her boss, DSS Secretary Finn Pratt. She said it would have been her practice to do so. Such evidence may have been contained in her personal notebooks, which the inquest heard she had ‘destroyed’ when she retired in mid-2017.

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Wilson said DHS began to encroach on his department’s responsibilities, which caused confusion when the program was developed in early 2015.

But she said she “thought we killed him”, referring to the plan.

The inquest heard that Wilson and Pratt had a meeting with Morrison on January 22.

Assistant Senior Counsel Justin Greggery asked: ‘Did you say that to Minister Morrison on January 22?

Wilson replied, “No.”

Greggery said: ‘Surely the clearest way to kill him was to put the advice, both legal and political, in writing and send it to your own minister?’

Wilson replied that “in hindsight, I wish we had,” prompting Greggery to note that there was nothing stopping him from doing so.

Greggery said it was his responsibility to stop the proposal, but instead his department had “either with your direct involvement or your conscious involvement” actually engaged with DHS about the “language used in the proposal”.

Responding to Wilson’s suggestion that his department had provided “feedback” indicating it was “problematic”, Greggery said there was a difference between giving feedback and “saying you can’t move a project forward. “. [for the minister] … because it is against any social security policy”. “So don’t put it in a draft, the train is leaving the station, right?”

The inquiry previously heard a minute sent to Morrison in January suggested that legislative change may be needed to implement these welfare compliance measures.

But, according to Wilson’s testimony, “the risk significance of policy and legal issues was communicated to the Department of Social Services but was not communicated to the Minister of Social Services.”

The use of income averaging – or what has become known as robodebt – was not specifically flagged in the budget, which noted a series of welfare compliance budget measures, including an increase in data matching. He only appeared at the end of 2016 after the program was intensified and caused public outrage.

Wilson said she only realized income averaging was being used in the “last part of 2017.”

Greggery asked if, as assistant secretary, she had told anyone “it’s illegal and…it has to stop.”

She said she lacked courage, adding “it seems shocking [but my attention] dealt with a range of other government priorities”.

Asked if there was anything she “feared” about, Wilson said the working environment under her new boss, DSS Secretary Kathryn Campbell, was “more authoritarian”. She had a “less mutually respectful” relationship with Campbell, Wilson said. Campbell will testify on Thursday.

Despite insisting she didn’t realize income averaging wasn’t being used until late 2017, the inquest heard she chaired a meeting in January 2017 where DHS said to the department that he was using “income averaging” as a “last resort”.

“Yes, we were told it was a last resort and we were very surprised,” she said.

The royal commission before Catherine Holmes continues.

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