Billionaires declared to be bad for the planet - especially those who send C02-e emitting rockets into space

OXFAM, Policy and Practice, Briefing Note, 7 November 2022, excerpt:

Carbon Billionaires: The investment emissions of the world’s richest people

Overview

The world’s richest people emit huge and unsustainable amounts of carbon and, unlike ordinary people, 50% to 70% of their emissions result from their investments. New analysis of the investments of 125 of the world’s richest billionaires shows that on average they are emitting 3 million tonnes a year, more than a million times the average for someone in the bottom 90% of humanity.

The study also finds billionaire investments in polluting industries such as fossil fuels and cement are double the average for the Standard & Poor 500 group of companies. Billionaires hold extensive stakes in many of the world’s largest and most powerful corporations, which gives them the power to influence the way these companies act. Governments must hold them to account, legislating to compel corporates and investors to reduce carbon emissions, enforcing more stringent reporting requirements and imposing new taxation on wealth and investments in polluting industries…...

Investments billionaires make help shape the future of our economy, for example by backing high carbon infrastructure, locking in high emissions for decades to come. Our study found that if the billionaires in the sample moved their investments to a fund with stronger environmental and social standards, it could reduce the intensity of their emissions by up to four times.

The role of corporates and investors in making cuts to carbon emissions that are needed to stop global warming of more than 1.5°C will be a hot topic at the upcoming 27th Conference of the Parties of the United Nations Framework Convention on Climate Change (UNFCCC) in Egypt. Yet despite the corporate spin, their actions fall far short of what is actually needed to stop catastrophic climate breakdown.

Governments should tackle this issue with data, regulation and taxation. They must systematically report on the emissions of different income groups in society, instead of relying on averages which obscure carbon inequality and undermine effective policy making….

In 2021, research conducted by Oxfam and the Stockholm Environment Institute (SEI) revealed that the richest 1% (around 63 million people) alone were responsible for 15% of cumulative emissions and that they were emitting 35 times the level of CO2e compatible with the 1.5°C by 2030 goal of the Paris Agreement.⁷ Similar findings have been reported by economists Thomas Piketty and Lucas Chancel.⁸ Another study drew on public records to estimate that in 2018 emissions from the private yachts, planes, helicopters and mansions of 20 billionaires generated on average about 8,194 tonnes of carbon dioxide (CO2e).⁹ By contrast, any individual among the poorest one billion people emits around 1.4 tonnes of CO2 each year.¹⁰

More recently, Twitter accounts tracking private jet travel have brought the issue of carbon inequality to public attention with revelations that, in a matter of just minutes, billionaires are emitting more CO2 than most people will emit in a year.¹¹…..

The billionaire space race has highlighted how a single space flight can emit as much CO2 as a normal person will in their lifetime.¹²12 Adding fuel to the fire, this same group of people have the resources to avoid the consequences of climate change, which will be felt most heavily by the poorest people….

Every person on earth emits carbon, but the sources of these emissions change the further up the income scale you move. A person’s total carbon footprint can be divided into personal consumption emissions, emissions through government spending and emissions linked to investments.

For the majority of society, people’s emissions from investments are minimal. But for the richest in society this is reversed, with emissions from investments becoming the biggest source – for the top 1%, between 50% to 70% of their emissions, according to one estimate.¹⁴ This mirrors income inequality, where the majority of people derive their incomes from work but the richest derive most of theirs from returns on their investments.

This paper begins with the world’s very richest people and examines the scale of their investment portfolios in order to make an estimate of their investment emissions…..

The 35-page paper can be read and downloaded from here.

Australia is seeing mortgage stress and other cost-of-living pressures rise, but we can avoid the financial impact being felt in the UK and US, says a UNSW Business School real estate expert

A perspective on the national economy, inflationary pressures, interest rates, house prices, household budgets and cost of living......

UNSW, media release, 7 November 2022:

What happens to the economy if you can't pay your home loan?

Australia is seeing mortgage stress and other cost-of-living pressures rise, but we can avoid the financial impact being felt in the UK and US, says a UNSW Business School real estate expert.

For economists – and indeed, anyone else with an interest on how much they spend at the supermarket – cost-of-living and housing prices have been hot topics in 2022. The Reserve Bank of Australia (RBA) has been trying to combat rising inflation with interest rate raises (read how that works here).

The latest rise was announced by the RBA last week on November 1, with the official cash rate rising to 2.85 per cent.

This process has contributed to a fall in house prices in some areas, as well as fears from mortgage holders that they won't be able to make payments on the now larger amounts.

“Australians have been fortunate to see sustained house price growth for a while now,” says economist and expert in real estate markets, Dr Kristle Romero Cortés Associate Professor in the School of Banking & Finance, UNSW Business School. “But they need to know, house prices can come down too.”

But while data from the Domain Group (shares of which are majority owned by Nine Media) might have recently shown the sharpest quarterly decline in house prices since 1994 across the country’s biggest capital cities, Dr Romero Cortés isn’t unduly concerned about house price falls.

“Commentary on the housing market is quite sensationalised in the media.”

But when it comes to not being able to pay the mortgage, and the impact higher loan repayments might have on the economy? That’s a bit more complicated to predict.

Why Australia may not follow other countries into financial disaster

Australians only have to look over to the United Kingdom to feel nervous when witnessing the impact of high inflation and interest rates on the economy and the day-to-day lives of financial situation of its citizens.

Like Australia, the UK’s central bank (the Bank of England) has introduced a series of interest rate hikes that have had a limited effect. Unlike Australia, the UK economy is still reeling from Brexit, plus a post-pandemic recovery, high inflation and energy costs, and levels of wage stagnation that have seen various sections of the working population strike.

The country has also just experienced the effects of a disastrous set of economic policies and extensive tax cuts for the wealthy implemented by Liz Truss as prime minister, which would have put money into in an already inflated economy (where the idea is to usually ‘cool’ things by encouraging people not to spend).

This spooked the financial markets to such a degree that investors quickly sold off British assets, including government bonds. The value of the pound plunged, forced the Bank of England to take an unprecedented step and pledge 65 billion pounds worth of bonds to stop pension funds from failing and stabilise the market … and caused Liz Truss to resign after just 44 days.

For the average Briton, this situation has led to a greater threat of recession: something which could lead to loss of jobs, higher unemployment, higher inequality, wage growth that is too low to match price increases, and issues meeting costs, such as regular mortgage payments that have already risen because of interest rate hikes.

But does the UK situation foreshadow D-R-A-M-A for the Australia’s own economy and housing market? Dr Romero Cortés says no – for several reasons.

Australians are fans of variable rate loans - unlike in the UK

As well as not experiencing a Brexit-like crash or an energy price crunch to the same degree, a big point of difference is that Australians are more likely to have opted for the more flexible variable rate mortgages, than in the UK, where homeowners are more likely to have picked fixed rate mortgage.

In the UK, 74 per cent of homeowners have a fixed rate mortgage for their home loans, and 96 per cent have chosen this option since 2019, according to data from UK-based trade association, UK Finance. AMP Capital data shows that Australia has a higher share of mortgage holders with variable rate mortgages. Just 10-15 per cent picked fixed rates before 2020 (although this rose to 40 per cent in 2020-2021).

While variable rate mortgages can be a great option when interest rates are low in the short-term, fixed rate mortgages can be more predictable over the long-term, as they are less impacted by interest rate rises that can raise overall home loan repayments.

“What we see in the US or Europe is not necessarily what we will see here,” Dr Romero Cortés says. “The US Federal Reserve (Fed) or the Bank of England are also effectively trying to slow down the economy, but when they raise their rates, they can't reach a large portion of homeowners that have a 30-year fixed rate mortgage.

“The Fed and the Bank of England can raise cash rates all they want – they are not reaching these homeowners.

“In Australia, our increases from the RBA pass through the banks almost instantaneously to the consumers,” she explains. “There is a slight delay because banks want to give borrowers as much time as possible to budget in an increase, but that rate does flow through almost automatically in a way that's much faster here than you'll see in countries like the US and UK.”

This means, faster possible cooling impacts on the economy with the RBA puts interest rate hikes in place.

Another big factor is that the big four Australian banks are highly capitalised.

“They are flush with cash,” explains Dr Romero Cortés. “I study the financial network in Australia, and it is very sound. We won’t see the kind of crisis that we saw in the US in 2008, where the banks were holding assets that they didn't understand the underlying worth of.”

What does that mean for mortgage stress and the Australian economy?

Dr Romero Cortés say that while lifting of interest rates might mean Australia will see mortgage stress rise faster than in other places, it is this situation that helps the RBA prevent the economy from “running red hot” and collapsing in on itself.

“Like any central bank, the RBA wants to ensure price stability, and they will do whatever it takes to prevent us from losing this. They don’t want consumables like bread and eggs to suddenly be seven times as much the next day. If that happens people will revolt, effectively.

“We're nowhere near there. But that's why we don't want to get anywhere near there. So, the RBA stay very much on top of this, and their role is to keep this issue as front and centre of the Australian public for as long as they need, so they are more cautious with their spending over a longer period of time.”

It’s in this way that the RBA plays a psychological stabilising role, not just a financial one.

“You know, ‘Okay, the RBA is on this: so, I don't need to freak out’,” says Dr Romero Cortés. “Because if you as a member of the financial public start freaking out, you’re more likely to make poor financial decisions which have more of a domino effect on the wider economy.”

Having said that, there is a limit to how much financial stress homeowners can undergo.

"There could be a point where homeowners and others can't withstand the raising of monthly repayments any longer,” she says. “This is not yet the case.

“Long term, you would expect some sort of horizon where things settle around 4 or 5 per cent cash rate. Australia is highly leveraged (meaning it has an on average high level of debt to equity), so more than that would be difficult to sustain.”

Banks don’t want to see mortgage defaults

At the end of the day, lenders don’t want homeowners to default on loans or to proceed with a repossession. It’s costly, in time, effort and capital for them, says Dr Romero Cortés. They would much rather work with the borrower before they get to that point of extreme financial difficulties.

“A homeowner in financial stress would contact your bank, who would require some documentation of financial hardship, and then would work with you either in a payment plan or deferral plan, refinancing or making interest-only payments.”

Remember: you're not getting out of it. You still pay it, the interest is still accruing, and it could lengthen the loan term. All this means that borrowers are going to consume less in other places, and therefore is supposed to lead to a ‘cooling’ of the economy.

What happens if cost of living doesn’t come down?

But if living here gets too hard and expensive with inflation or higher mortgage repayments, you could see Australia reputation as ‘a good place to live’ take a hit, pushing down the number of people who want to live here, and putting further pressure on an already tight labour market, says Dr Romero Cortés.

For example, a portion of all the Australians with overseas heritage might decide Australia is too hard and expensive to live in and move to their other country of citizenship. That’s when it might start to get uncomfortable.

"Australia has an economy that's built up by people wanting to come to Australia, and we’re constantly growing in that fashion,” explains Dr Romero Cortés. “There's demand for housing, education, and we currently have people willing to come here.

“So, the government can say whatever they want about the RBA [and their decision to raise rates] so they will get voted in again. But the RBA doesn’t have a choice: one family defaulting on their mortgage, compared to everyone not being able to afford bread, is what they are envisioning.”

Does all this mean house prices will come down more?

Higher mortgage repayments could pressure homeowners to accept lower sale prices than they might have expected from their property, investment or otherwise; nudging down overall prices on the property market over a period of time, as well as the occasional ‘fire sale’.

“Are you going to see a massive crash of house prices where you see a Bondi four-bedder going for $500,000? No.

“But we could see a small depression in prices where 5 to 10 per cent of the price is cut. Even if you cut off 10 per cent from a $2 million home, that's $200,000 less. This means unless they have to, sellers are not going to want to sell.”

All this means it is true you're going see some very high mortgage payments and additional cost of living pressures as homeowners prioritise their mortgage repayments, Dr Romero Cortés points out.

“It’s also true that politicians (who are complaining about the RBA’s approach) may be among those who own a lot of investment properties themselves.”

Dr Kristle Romero Cortés is an Associate Professor in the School of Banking & Finance in the Business School at UNSW Sydney, an expert in real estate economics and formerly worked at the Federal Reserve Bank of Cleveland.

Three years and seven months after making the commitment, Perrottet Government reluctant to transfer responsibility for 15,000km of regional roads back to state now many of these roads are wracked by flood damage?

 

Clarence Valley Independent, 4 November 2022:

Minister for Regional Transport and Roads Sam Farraway has been forced to admit that not one single kilometre of a promised 15,000 kilometres of regional roads has been transferred from local councils to State ownership.

Under questioning by John Graham MLC during a recent Budget Estimates hearing, Minister Farraway could not bring himself to say the words “it is zero”, despite it being clear that zero roads have been transferred under the program.

The Minister dashed the hopes of regional motorists and cash-strapped regional councils that the glacial roll-out of the program would be sped up, saying the Government’s key 2019 election commitment is “not a burning topic” amongst regional councils.

The Minister also cast doubt on whether the full complement of 15,000 kilometres promised would be transferred, repeatedly stating that the policy was “up to” 15,000 kilometres.

Shadow Minister for Regional Transport and Roads Jenny Aitchison said the Minister’s evidence confirmed that the promise was a cynical attempt to pork barrel regional communities.

“This was a “magic pudding” election promise; every Nationals and Liberal candidate could point to a potential road in their electorate which could be eligible for reclassification or transfer, and the Government still, nearly four years later, hasn’t transferred a single one of them,” Ms Aitchison said.

The Labor candidate for Clarence Dr Leon Ankersmit said the promise clearly is a burning topic amongst locals whose tyres and cars are being wrecked by our potholes that are voluminous and crater deep … it is burning holes in their pockets.

“We’ve got priority regional roads in the Clarence Valley and Richmond Valley Councils that have been put on the back burner by this city-centric Government,” Dr Ankersmit said.

“When this policy was announced it was 15,000 kilometres of regional roads and then the dissembling started with ‘up to’.

“That is the whole problem with this particular election commitment; it has been short on action, vague on detail and has left local councils and locals in limbo land.”

“Clarence Valley Council is seeking to have a number of regional roads transferred to State ownership and management, but importantly, with council keeping state funded maintenance contracts to protect local outdoor jobs. Roads identified for transfer include Grafton to Yamba Road, Eight Mile Lane, Armidale Road, Orara Way, Wooli Road, Big River Way and Ulugundahi View; Iluka Road, Clarence Way, Tyringham Road, and Goodwood Island Road.

“Council is also seeking to have the following local roads reclassified to regional roads and transferred to the State: Angourie Road, Brooms Head Road, Gardiners Road, Amos Road and Palmers Channel South Bank Road, Coaldale Road, Rogans Bridge Road, Pringles Way, Ashby-Tullymorgan and Ashby-Jackybulbin Road, Old Glen Innes Road, Coldstream Road and Tucabia Road, and Sherwood Creek Road.”

Dr Ankersmit confirmed Clarence Valley Council wants to hand back all 378km of regional roads under its control or 15% of its total road network to the State Road network, also keeping maintenance contracts, with some relevant applications done in collaboration with neighbouring councils.

“This includes the full length of the Clarence Way.” Dr Ankersmit said.

“Richmond Valley Council is seeking to have Casino to Woodburn Road transferred to State ownership and what will be the Old Pacific Highway from Boundary Creek Road to South Woodburn Interchange to be a State asset with the State assuming responsibility for its maintenance.”

“However, at this point Richmond Valley Council has only been contacted about transferring the Broadwater to Evans Head Road from local to regional road. The issue about additional funds to Council to maintain the newly classified regional road has not been addressed.”

“Richmond Valley Council also nominated Naughtons Gap Rd (via East Street) from Bruxner Highway in Casino to the Lismore Kyogle Road to be re-classified from local to regional road, whilst remaining under Council control to protect local jobs.”

“Council also supported Kyogle and Lismore Councils in their proposal to have the Lismore Kyogle Road, as well as Lismore Coraki Road, and Wyrallah Road returned to the State.”…..

Around the traps on the Northern Rivers in November 2022

 

Clarence Valley Independent, 2 November 2022:

Yamba’s primary water supply switched

A hydrographic survey has been completed along the riverbank from the northern edge of Maclean to the Harwood Bridge to assess the risk of riverbank erosion affecting the water mains servicing Yamba.

Water mains run along both sides of Yamba Road, and Council has switched its main supply to the less vulnerable pipeline on the inland side of the road.

The pipeline on the river side will continue to be maintained as a back-up.

NSW Environmental Protection Agency (EPA), media release, 2 November 2022:

Northern Rivers residents and small businesses will be able to access flood support with a new NSW Environment Protection Authority (EPA) program supporting the management of contaminated lands following the devastating floods in early 2022.

NSW EPA Chief Executive Officer Tony Chappel announced the new program in Lismore and said the EPA is committed to doing all it can to help the region recover.

“Our role at the EPA is to protect the community and environment, and this program is about ensuring contaminated land is addressed so people have peace of mind about their land,” Mr Chappel said.

“I cannot begin to imagine how hard it has been for the community to return home after the flooding only to face a painstaking clean-up.

“We want to give Northern Rivers communities who have made that extraordinary effort the certainty that the land they live on is healthy and safe.

“This program will provide free, independent assessments for eligible properties, which will reveal if soils have been contaminated.

“If a property is deemed to be contaminated, we will also provide landholder assistance in cleaning-up soils and returning the environment to the best state possible.

“I want to thank all our EPA officers who have been working with other agencies to remove waste and debris from across the region.

“The volumes have been enormous and in the past week alone, we have removed 261 cubic metres of debris from our waterways, equal to that of three semi-trailer trucks.

The funding will also support the seven eligible councils (Lismore, Richmond Valley, Ballina, Kyogle, Tweed, Byron, Clarence) to assess any flood contamination to public areas as well as providing resources to manage contamination from future natural disasters.

The NSW EPA runs a number of programs to help regions impacted by floods, with the Shoreline Clean-up Program removing more than 17,800 cubic metres of flood debris from waterways in an area extending from the Queensland border to the Illawarra.

The Flood Recovery Program for Contaminated Lands is jointly funded by the State and Commonwealth disaster recovery funding agreement (DRFA). Residents can now apply on the Service NSW website.

The EPA has also launched an interactive visual flood debris map which demonstrates the scale and scope of the clean-up effort, as well as sharing stories from the community and EPA officers.

Royal Commission into the Robodebt Scheme is slowly but surely revealing the nastiness at the core of what was an extreme federal government & an increasingly politicized public service

 

Details of Scott Morrison's seven year war on the poor and vulnerable are being exposed.... 

The Saturday Paper, 5-11 November 2022:

Robo-debt: Liberals knew it was illegal before it started

Rick Morton, senior reporter.

@SquigglyRick

November 5, 2022

David Mason was the first person to give advice about a thought bubble program that would become robo-debt. In an email, he called it for what it was: a program with no legal basis that would result in serious reputational harm if it was allowed to go ahead.

His assessment should have been the end of the perverse experiment. Instead, this algorithmic program was used to terrorise welfare recipients for more than five years.

Mason was an acting director within the Department of Social Services (DSS) means testing policy branch when he was asked, in October 2014, to provide the advice. The service delivery arm of government, then known as the Department of Human Services (DHS), had cooked up a potential budget savings proposal that involved splitting taxation data into fortnightly blocks, when social security benefits are also paid, and using this to figure out if a welfare recipient had earned too much money and needed to pay back a debt.

“We would not be able to let any debts calculated in this manner reach a tribunal,” Mason warned. “It’s flawed, as the suggested calculation method averaging employment income over an extended period does not accord with legislation, which specifies that the employment income is assessed fortnightly.”

Again, Mason reiterated that the team could not “see how such decisions could be defended in a tribunal or court, particularly when DHS have the legislative authority to seek employment income information from employers”. He stressed that “the approach could cause reputational damage to DHS and DSS”.

On October 31, 2014, the team asked for a second opinion from within the DSS’s legal branch. The same person who had sought advice from Mason, Mark Jones, emailed principal lawyer Anne Pulford to note that the two departments were working together on payment assurance, as was normal, but noted “a strategy is being considered that requires legal advice prior to proposing it to government”.

This is important in establishing a provenance for the controversial robo-debt idea: although governments enthusiastically set expectations for savings in budget cycles, the robo-debt scheme itself was the brainchild of someone or some group within the DHS.

The legal advice from DSS, provided by lawyer Simon Jordan on December 18, 2014, was almost as unambiguous as David Mason’s: “In our view, a debt amount derived from annual smoothing or smoothing over a defined period of time may not be derived consistently with the legislative framework.”

This advice was a co-opinion from Pulford, who features repeatedly in the years to come.

“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.”

Five days later, Scott Morrison became the minister for Social Services.

The end. Or there things might have rested were it not for a gruesome lack of imagination on behalf of dozens of players across government. It is not that they lacked the ability to conceive or design this wicked hunter’s trap of a debt policy – that is well recorded – but that these figures apparently possessed an inability, at all levels of the public service, to wonder what the final outcome of such a hideous program might be.

And it was this: at least seven families believe the suicide of a loved one was connected to the receipt of a robo-debt letter. Hundreds of thousands of Australians were hounded by government officers and debt collectors for money they never owed.

To be clear, these people owed no debt – not because of some administrative technicality but because the Department of Human Services concocted a system that literally made them up, despite the above advice being provided before the program even made it into pilot form.

“Commissioner, we anticipate that the evidence to be adduced may be sufficient to show that the reason why no authoritative advice on the legality of the robo-debt scheme – and by that I mean from the solicitor-general or other eminently qualified counsel external to the department – the reason why no advice was obtained prior to the advice of the solicitor-general in September 2019 was because advice in one form or another within the Department of Social Services or Services Australia [formerly DHS] created an expectation within those departments that the external and authoritative advice may not be favourable in the sense that it may not support the legality of the scheme,” senior counsel assisting the Royal Commission into the Robodebt Scheme, Justin Greggery, KC, said on Monday.

Indeed, what has emerged in an explosive first week of full hearings is information that has been actively hidden from the public for almost six years. This includes multiple rounds of “advice” seen by the most senior people in both departments over many years before officials finally scurried to ask the solicitor-general for advice in 2019. The answers to questions sought by Services Australia in September of that year should have surprised nobody who had been paying attention.

The solicitor-general was very clear: the use of smoothed or apportioned tax office data “cannot itself provide an adequate factual foundation for a debt decision”. Further, his advice noted that the government couldn’t use the same data in the same way to essentially shake down past or current welfare recipients by presenting it to them and demanding they provide evidence that they did not incur a debt.

This advice continued a piece-by-piece demolition of the entire framework for robo-debt, noting that – as Greggery put it – compliance officers are required to investigate other sources of information, such as employer records, to justify the assumption that a debt exists. They cannot simply outsource this to welfare recipients by issuing threatening letters.

“Failure to respond does not provide positive proof of a debt, and the decision-maker cannot speculate about why a person may have failed to respond and to treat that speculation as evidence of a fact,” Greggery said on Monday, summarising some of the solicitor-general’s reasons.

“The question raised by the solicitor-general’s advice is whether the Commonwealth government was, prior to that point, recklessly indifferent to the lawfulness or otherwise of the use of averaged PAYG ATO data obtained from the taxation office to allege and recover debts.”

“Reckless indifference” is a phrase no barrister uses lightly. It is also a crucial element in the civil law of misfeasance in public office. In its own advice on the tort, the Australian Government Solicitor notes that the element of “bad faith” requires one of two things: either intentional harm caused by knowingly acting beyond their legal power or the defendant having been “recklessly indifferent to whether the act was beyond power and recklessly indifferent to the likelihood of harm being caused to the plaintiff”.

The story of robo-debt is one in which those responsible for it gradually knew less and less, and with less certainty, about its dimensions, about what it was going to be used for and how. What happened between 2014, when departmental advice cast near total doubt over the legality of robo-debt, and 2019, when the solicitor-general’s advice was finally delivered and led to the scheme’s ultimate end, is a collective act of leaning in to a studied ignorance.

We now know, from the evidence so far, that departments had all the legal power needed to compel information from businesses but that, apparently, the government “didn’t want [the] burden to be on employers”, according to a senior official at the DHS.

We know that design decisions were made in relation to the debt letters sent to robo-debt victims, which shunted them deliberately online rather than providing a contact number, because “past experience shows that if an alternative phone number is provided a significant proportion of recipients won’t engage online”.

We know the DSS, faced with an investigation by the Commonwealth ombudsman in early 2017, considered withholding the 2014 legal advice from that office and, even though it appears to have relented, had new advice drawn up by the same co-author of the 2014 document, Anne Pulford, which was used to hoodwink the ombudsman’s office and “show” robo-debt was legal.

We know that, once this convenient deception was established in the eyes of the ombudsman, its subsequent reports declaring robo-debt to be consistent with the legislative framework were used by the DSS as de facto legal justification for a scheme that was – and that they had every reason to expect was – illegal.

“You must have understood,” Justin Greggery put to Pulford during questioning on Wednesday, “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 robo-debt scheme.”

It was Greggery’s contention that nothing had changed in the question put to Pulford in 2014 and again in 2017, but somehow the answer had.

“This was the most hypothetical advice that could be provided to legally justify some aspect of the scheme then in existence,” he pressed, adding that it had no practical application at all.

Pulford agreed it was “hypothetical” but said she believed she was answering a “quite narrow and quite technically focused general question” put to her by acting group manager Emma Kate McGuirk, who emailed on January 18, 2017, and asked: “As discussed, I am looking for advice, please, regarding a last resort method of debt identification for income support recipients … is it lawful to use an averaging method as a last resort to determine the debt?”

Pulford says she does not recall the robo-debt program being mentioned in this context. That being the case, Greggery pushed, why did emails written by Pulford mention a “business need” to “justify” the question being asked?

“The difficulty with you saying that you don’t believe the robo-debt scheme was raised is the evidence that you have given that you simply cannot recall the context of what was occurring socially, or politically, or within the office, or within your department, at the time that you were asked this question,” Greggery said.

“As a purely academic question about administrative decision-making, one doesn’t need to have regard to a business need do they?” No, Pulford agreed. She was then asked if she felt pressure from above to massage her advice.

“I believe I felt pressure from Ms McGuirk to provide an answer that justified taking action in circumstances which the broad general advice in 2014 would not have supported on its face,” she said.

“I now cannot recall whether that was done in full awareness of the robo-debt scheme being in full flight or not.”

McGuirk, who had involvement with robo-debt for only a matter of weeks and who took the stand briefly on Wednesday afternoon, said she could not recall this conversation with Pulford but accepted one must have happened, as it is referred to in the email.

Greggery and Pulford argued back and forth about whether the 2017 advice was just a “rehash” of the same 2014 question with a different answer. Greggery’s view concluded like this: “Despite all the investigation in the world, if all you’re left with is smoothed income, you still arrive at the same answer that you gave in 2014. Legally, the absence of evidence doesn’t amount to positive proof of a debt, correct?”

Pulford wrote a separate email in February 2017 to a colleague in which she noted that “DSS policy has become more comfortable with the DHS approach of using smoothed income, given it is being applied as a last resort”.

She continued, “This appears to represent a change in DSS position, although it doesn’t represent a change in the legal position.”

On the stand, Pulford accepted that this meant the robo-debt scheme was, and remained, “legally flawed”.

In isolation, it is conceivable that the different cogs in the social service machine really had become aligned with the original DHS proposal. After all, despite early and significant doubt over its legality, the idea still made it to the minister’s office in a joint executive minute alongside a bundle of options presented for the 2015-16 budget.

A new minister at that time, Scott Morrison, with his eyes on the Treasury, liked the “PAYG” element. Once he had seen it, there was apparently no turning back.

“Minister Morrison has requested that the DHS bring forward proposals for strengthening the integrity of the welfare system,” DSS branch manager Catherine Dalton wrote to Pulford in January 2015.

“DHS has developed the attached minute and, given the quick turnaround required to 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.

“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, as well as some indication of the lead time required to obtain legislative change?”

This, of course, was never done. After the PAYG option was cleared for advancement by Morrison, DHS drafted a “new policy proposal”, including a checklist that indicated “no legislation is required”.

So far the inquiry has heard only from DSS public servants.

What began as an idea floated within the public service to please political masters had done exactly that. Now that it involved the knowledge of those politicians, the pressure to deliver was many orders of magnitude higher than before. All of this was happening despite additional “legal questions” being identified in 2015 by internal DSS lawyer David Hertzberg. Handling a jarring disconnect between what was now being asked, and the ever-growing certainty that robo-debt had no legislative basis whatsoever, required an unlearning of unhelpful facts or the almost comical evasion of knowledge.

Take the events of mid-2018, when the DHS referred an Administrative Appeals Tribunal to DSS to consider an appeal. At stake was a robo-debt case that threatened to derail the program, or at least add to mounting and sustained public backlash.

The AAT decision so alarmed DSS officials that they punctured a longstanding refusal to get outside legal counsel regarding the legality of robo-debt and enlisted the private law firm Clayton Utz to provide an opinion on the matter.

In the eyes of those same officials, it was not a good opinion.

“In our view, the Social Security Act in its present form does not allow the Department of Social Services to determine the Youth Allowance or New Starts recipient fortnightly income by taking an amount reported to the ATO for a person as a consequence of data-matching processes and notionally attributing that amount to or averaging that amount over particular fortnightly periods,” the draft advice says.

This draft advice was sent to DSS principal lawyer Anna Fredericks on August 14, 2018, and must have produced an extraordinary cognitive dissonance among legal officers there.

Fredericks emailed colleagues and said the advice from Cain Sibley and John Bird was “somewhat unhelpful”.

“[They] called me to discuss as the advice is somewhat unhelpful if the mechanism is something that the department wants to continue to rely on,” Fredericks said in the email, sent to Melanie Metz and Pulford. “Cain advised 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.”

Backed into a corner, someone within DSS decided to deal with the problem by pretending it didn’t exist. The Clayton Utz invoice was paid but the department never asked for the draft advice to be “converted” to final, more “official”, advice.

Was this not extraordinary? No, Pulford said, because this kind of thing happened all the time. If the advice on any given matter was not favourable or judged as no longer needed, it would not be finalised.

Commissioner Catherine Holmes, who has shown herself to be a fair but direct chair of the inquiry, simply said: “I am appalled.” ……

After the first full week of her royal commission, a few things are clear. Robo-debt was a wicked scheme. It was illegal, and many people knew or ought to have known it was illegal from its conception. Despite this understanding, which never vanished, it was rolled out in such a way as to herd past and current welfare recipients, like cattle, through deliberately designed gateways that maximised the amount of money they could be forced to pay.

For many, they never owed a cent. This was a particularly cruel abuse of the Australian public, at scale, by their own government, which persisted – indeed, which was covered up – for five years against truly overwhelming evidence that it should never have been allowed to begin.

Read the full article here.

Cartoons of the Week

 

Cathy Wilcox

Fiona Katauskas

Royal Commission into the Robodebt Scheme will resume on 6 December and this public hearing block will run until 16 December 2022

 

Hearing block 2

Public hearings for the Royal Commission into the Robodebt Scheme will resume in Brisbane from Monday, 5 December 2022 with hearing block 2 running until 16 December 2022.

Hearing block 2 will continue the inquiry into the establishment, design and implementation of the Robodebt scheme together with the impacts of the scheme on individuals.

The focus will be on:

• The impacts of the scheme on individuals;

• The experience of representative bodies and the Government’s response to identified shortcomings in the scheme;

• The role played by the Budget process in establishing the scheme, the measures necessary for it to continue, and the involvement of portfolio ministers and SES officers in this process;

• The extent of planning and testing undertaken during the pilot stage;

• The investigation undertaken by the Commonwealth Ombudsman;

• Data-matching and compliance with privacy laws and data-matching guidelines;

• The means of debt recovery including the use of debt collectors and commissions on amounts recovered.

Watch the hearings

The general public can attend and watch the hearings in person. The hearings will be held at Pullman Hotel King George Square, corner Ann and Roma streets, Brisbane City. Those interested can pre-register their attendance.

The hearings will also be streamed live on the home page of the Commission's website. Further information on watching or attending can be found on the hearings page.

Hearings will typically run from 10am - 4.30pm with a break for lunch at 1pm, subject to change.

Please note these times are AEST, as Brisbane does not observe daylight saving. For example, 10am AEST is 11am AEDT. Find out more about Australian time zones.

Share your story

The Commission is inviting submissions from members of the public. The online form and details about the submission process are available using the button below.

Submissions will be accepted until 3 February 2023.

MAKE A SUBMISSION