That "massive failure in public administration" of Australia's social security scheme, by way of the creation of the unlawful 'Robodebt' automated data matching program, has to date cost the Morrison Government: (i) est. $8.4M in Federal Court applicants' awarded legal costs; (ii) approx. $751M in debt repayments to applicants; (iii) a further $103.6M in settlement distribution costs; (iv) the forced abandonment of recovery of up to $1.01 billion in debts claimed by Centrelink but not yet realised; and (v) government having to absorb its own legal costs as well as the former unlawful program's multimillion dollar administration costs.

 

ABC News, 11 June 2021:

A Federal Court judge has delivered a withering assessment of the unlawful Robodebt recovery scheme, calling it "a shameful chapter" and "massive failure in public administration" of Australia's social security scheme.

He also ordered the Commonwealth to pay costs of $8.4 million to Gordon Legal, which brought the class action against the Commonwealth on a no-win, no-fee basis.

"This has resulted in a huge waste of public money," he said.

Justice Murphy's judgement gave legal effect to a settlement reached between the Commonwealth and people wrongly pursued for debts last year.

The Commonwealth agreed to fund compensation, pay back wrongly raised debts and drop debt recovery actions, but has not admitted liability.

Robodebt was an automated debt collection system in place between July 2015 and November 2019 that used data-matching in an attempt to identify the overpayment of social security benefits.

More than $750 million wrongfully recovered

The court heard that as part of the scheme, the Commonwealth had unlawfully raised $1.73 billion in debts against 433,000 people.

Of this, $751 million was wrongly recovered from 381,000 people.

"The proceeding has exposed a shameful chapter in the administration of the Commonwealth social security system and a massive failure of public administration," Justice Murphy said.

Justice Murphy said he "could not help but be touched" by the "heart-wrenching" stories of people who had suffered as a result of the scheme.

"One thing … that stands out … is the financial hardship, anxiety and distress, including suicidal ideation and in some cases suicide, that people or their loved ones say was suffered as a result of the Robodebt system, and that many say they felt shame and hurt at being wrongly branded 'welfare cheats'," he said.

He said ministers and public servants should have known the method of using taxation income records to estimate a welfare recipient's average income was flawed.

"However, it is quite another thing to be able to prove to the requisite standard that they actually knew that the operation of the Robodebt system was unlawful," he said.

"There is little in the materials to indicate that the evidence rises to that level….

In settlement of Prygodicz v Commonwealth of Australia the Morrison Government made no admission of legal liability with regard to any aspect of the unlawful Centrelink debt collection program.

It never ends

— Asher Wolf (@Asher_Wolf) June 12, 2021

BACKGROUND

Prygodicz v Commonwealth of Australia (No 2) [2021] FCA 634 (11 June 2021)

Commonwealth of Australia v Prygodicz [2020] FCA 1516 (14 October 2020)

Prygodicz v Commonwealth of Australia [2020] FCA 1454

Morrison Government to settle 'robodebt' class action out of court reportedly for in excess of $1.2 billion

 

In July 2016 the Turnbull Coalition Government began to issue income compliance notices based on automated data matching to recipients of government cash transfers such as Job Seeker, Youth Allowance, Abstudy, Single Parent Payments and Family Tax Benefit payments.

At the time the then Minister for Social Social Services Scott Morrison expected to clawback an est. $1.7 billion dollars over five years from individuals who were, or had been in the past, receiving a Centrelink pension, benefit or allowance.

From its beginning this income compliance scheme was seen as flawed.

On social media and elsewhere the scheme began to be called 'robodebt' and unverified reports began to emerge of vulnerable people in receipt of large robodebts suiciding.

In February 2019 it was revealed that the Morrison Government had spent between $400m to recover just $500m from welfare recipients through the flawed 'robodebt' scheme.

By 2019 at least 570,000 of over 600,000 income compliance notices issued were considered to be unlawful. As were Australian Taxation Office garnishee notices associated with these alleged debts.

A total of 18,000 individuals who consented to automated data matching to calculate an alleged debt were also considered to have been subject to an unlawful action.

In November 2019 the Morrison Coalition Government called a halt to using automated data matching to calculate income compliance, as it was faced with at least one adverse court judgment and a forthcoming class action in the Federal Court of Australia.

On 29 May 2020 the Morrison Government announced that it now accepted that many debts raised under the 'robodebt' system were unlawful and, consequently, that it would refund 470,000 debts raised totalling $721 million to 373,000 people. This refund did not cover all members of the class action.

The class action was scheduled to go to trial on 16 November 2020.

Yesterday, Monday 16 November, came news that the class action had been settled out of court by the Morrison Government. Presumably in order that Morrison & Co. along with senior Social Security and Centrelink bureaucrats could avoid the possibility of having to give evidence in court, to avoid any legal admission of liability and, to avoid the risk of a detailed adverse judgment.

It seems that Scott Morrison's personal war on the poor and vulnerable, begun when he was Minister for Social Services and continued on during his time as Treasurer and now as Australian Prime Minister, has cost the federal government well in excess of  $1.2 billion when one factors in the federal government's legal costs and the pre-existing 'robodebt' scheme administration costs - including debt recovery agent commission payments.

Gordon Legal, media release, 16 November 2020:

Gordon Legal announces today the settlement of the Robodebt Class Action, subject to the approval of the Federal Court of Australia.

The settlement reached with the Commonwealth of Australia means that if approved by the Court, since the commencement of the Robodebt Class Action, more than $1.2 billion in financial benefit will have been provided to approximately 400,000 group members.

In settling the class action, the Commonwealth has not admitted that it was legally liable to Group Members. [my yellow highlighting]

KEY POINTS:

The total financial outcome achieved is made up as follows:

• The Commonwealth has today agreed to pay $112 million in compensation to approximately 400,000 eligible individual Group Members, including legal costs;

• The Commonwealth is repaying more than $720 million in debts collected from Group Members invalidly and will continue to provide refunds;

• The Commonwealth has agreed to drop claims for approximately $398 million in debts it had invalidly asserted against group members of the class action;

• Subject to Court Approval, a Settlement Distribution Scheme will provide that eligible individual Group Members’ entitlements will be assessed and all amounts due to them be paid in 2021.

Subject to approval by the Court, a notice setting out the details of the proposed Settlement Distribution Scheme and the Court approval process will be provided to all Group Members.

Gordon Legal Partner, Andrew Grech said:

“We want to acknowledge the courage of the lead applicants; Katherine, Elyane, Steven, Felicity, Shannon and Devon, who led these proceedings on behalf of all Robodebt victims in pursuit of this class action, which has allowed this outcome to be achieved today.

Our clients have asked us to especially thank Bill Shorten for his relentless pursuit of this issue, for his compassion over the last four years for vulnerable Australians hurt by Robodebt and for bringing the case to Gordon Legal’s attention when it seemed that all other options had been exhausted and only resorting to the legal system would help.

Once again we would like to acknowledge the work of the legal team at Victoria Legal Aid, who worked tirelessly to bring a number of individual claims before the Federal Court before the Class Action was commenced as well as the efforts of many community legal services in the Welfare Rights Network, such as Social Security Rights Victoria who have been advocating for victims of Robodebt for the last few years.

Our clients would also like us to acknowledge the Federal Court of Australia for its preparedness to schedule frequent case management hearings and to facilitate a trial of the proceedings so quickly, notwithstanding the difficult circumstances of the Melbourne Covid-19 lockdown.”

– ENDS –

For more information visit: https://gordonlegal.com.au/robodebt-class-action/robodebt-faqs/

Like most political bullies 'Scotty From Marketing' Morrison runs away when he is publicly caught out

Crikey inq, 1 June 2020

Crikey inq, 1 June 2020: 

It’s been a while since Australian politics saw an act as gutless as Scott Morrison’s on Friday. 

Mere minutes after the prime minister finished another of his interminable post-national cabinet monologues and walked away from journalists, Government Services Minister Stuart Robert issued a media release revealing one of the most expensive backflips in Commonwealth history. The government would repay at least $720 million in fake debts it had “raised” against welfare recipients under the now discredited robodebt scheme. 

 At a media conference conveniently on the Gold Coast, rather than before the same journalists Morrison had just walked out on, Robert tried to claim he’d moved quickly to address the scheme’s flaws: “the information presented to me saw a change in November, I acted swiftly on behalf of the government to pause debt recovery and to refine the system.” 

Robert refused to apologise to the 373,000 victims (at a minimum) of the scheme. Christian Porter, appearing on the ABC yesterday, also refused to apologise. Both at least fronted the cameras. 

Scott Morrison ran away. 

Coward. 

This was Scott Morrison’s scheme, one he — the former social services minister — proudly boasted about as treasurer in the 2016 election campaign, claiming it would pump billions into the budget bottom line. 

Now it’s fodder for a Friday afternoon garbage dump, with junior ministers sent out to publicly eat the shit sandwich. 

It’s unlikely the scheme will ever generate a single cent of additional revenue, given the repayment, the likely compensation, the legal costs associated with a number of cases, and the extraordinary costs of implementing the supposedly automated scheme, including the siccing of debt collectors onto innocent welfare recipients. 

Morrison and his colleagues, and the Social Services public servants who devised and implemented the scheme, will be hoping to avoid accountability for the debacle, which goes back to a single fact: there was always a serious question mark over the legality of the mechanism at the heart of robodebt, income averaging. 

The government gave up pretending income averaging was lawful last November, just before settling the case brought by Deanna Amato in the Federal Court. 

Robert is trying to pretend that that was when the penny dropped about income averaging, and the government is refusing to say how long it knew about the lack of a legal basis for its flagship savings measure. 

As is now well documented, however, the lack of a lawful basis was clear from early on. 

Social security law expert Matthew Butt raised serious questions about the legality of income averaging in early 2017, noting the limitations on its use under legislation and that Human Services’ own guidelines recommend that averaging be used selectively. 

Administrative Appeals Tribunal (AAT) member Terry Carney found that there was no legal basis for the debts raised at the same time, in decisions the government declined to appeal. The government instead dumped Carney from the tribunal while it stacked it with former Coalition MPs, staffers and party members. ....

Why did public servants prepare and implement a scheme they knew had a strong chance of being found unlawful? Was legal advice sought? Or did Social Services, like the Department of Health in the sports rorts scandal, refuse to obtain legal advice it knew would show there was no legal basis for the proposed actions? 

The financial cost of the debacle is only one aspect. Robodebt needlessly inflicted misery and anxiety of hundreds of thousands of Australians. The number of suicides caused by the receipt of automatically generated debt letters is unlikely to ever be known. 

Throughout, the bureaucrats involved have sought to stymie or evade accountability. In the most recent round of Senate estimates hearings, departmental officials like Social Services secretary Kathryn Campbell refused to provide basic information, like the number of victims of income averaging, to a Senate committee. 

Similar obfuscation is likely to be used against attempts by the Senate to establish the crucial issue of how much Social Services knew about the unlawfulness of income averaging when the scheme was crafted in 2015, what advice was sought and what was communicated to the minister.....

North Coast Voices received a takedown notice on 19 May 2020

On 24 April 2018 North Coast Voices published a blog post title "Hank Jorgen and Centrelink unleash the dogs…..".

On 19 May 2020 the blog received a Google takedown notice for that particular post, effective immediately.

Now apart from its title, the post only contained one sentence of comment by North Coast Voices:

"Forget establishing that an actual debt exists – this is 2018 and come hell or high water the Turnbull Government wants to use Centrelink to prop up its financial bottom line in time for the May 2018 budget papers."

The remainder of the post comprised of extracts from two online mainstream media articles - one by journalist Alice Workman published by Buzzfeed and the other by journalist Noel Towell published by the Canberra Times. These extracts were followed by inclusion of five tweets politely critical of 'robodebt' and two links to NotMyDebt.

Both media articles are still online.

So what sin had North Coast Voices committed?

Well apparently it had used a BuzzFeed extract which mentioned a business called Detective Desk - an IT company whose services were used by at least one debt collection agency (Australian Receivables Ltd) whom Services Australia had contracted until 3 February 2021 to assist with debt management/recovery under the automated data matching Online Compliance Intervention System process aka robodebt.

One can deduce this because the 2017 Buzzfeed article now has a new headline and is prefaced by a grovelling apology which runs thus:

CORRECTION

May 19, 2017, 2:51 PM

An earlier version of this article, which was entitled 'Your private information is being sent overseas by Centrelink', included some statements about Detective Desk which were corrected and are retracted by BuzzFeed. BuzzFeed regrets these errors.

One has to wonder if the unknown person or persons who decided to chase up mention of this company and remove any part of the original Buzzfeed article from view after all these years was doing so because a class action is now underway in the Federal Court of Australia which may expose the full lengths that Liberal MP for Cook Scott Morrison, first as Minister for Social Services, then Federal Treasurer and finally as Prime Minister, went to in order to unlawfully claw back money from vulnerable welfare recipients.