Robodebt Report Reveals Federal Government’s Obsessive Demonisation of the Unemployed

Making jibes about welfare recipients, or dole bludgers, in the popular disparaging parlance, has, for decades, been an easy way to score political points, in a practice where those without employment and in need of a helping hand, are often served up as an all-round excuse for our societal woes.

Pinning the problem on the jobless has been a major party sport since the 1980s, which began with the shift away from the welfare state and the birth of neoliberalism, which saw Centrelink rolled out in the mid-90s, along with employment network privatisation and the mutual obligation pile on.

The myth of the dole bludger is the reason why although the poverty line for a single adult stood at $602 a week in the last quarter of 2022, when such a person is experiencing joblessness, they can only obtain around $346 a week from the government.

And it’s this negative attitude that permitted the Coalition, for just over three years commencing in September 2016, to run a system, known as Robodebt, which was designed in such a flawed manner that it saw computer algorithms hunting down some of society’s most vulnerable for false debts.

Indeed, the just released Royal Commission into the Robodebt Scheme report reveals a government so set on demonising the unemployed that whilst some of the nation’s richest fail to pay a cent in tax, the government pursued those who can’t find a job for false debts at times to their death.

Debt recovery fever

“Politicians need to lead a change in social attitudes to people receiving welfare payments,” Royal Commissioner Catherine Holmes warns at the outset of her report into Robodebt, underscoring that while welfare fraud evidence is “miniscule”, various ministers have long asserted the opposite.

“Anti-welfare rhetoric is easy populism, useful for campaign purposes,” she continued. “It is not recent, nor is it confined to one side of politics, as some of the quoted material in this report demonstrates.” And she added that it was in the public interest to bring this persecution to an end.

Then Liberal social services minister Kevin Andrews commenced, in mid-2014, tossing about the idea of collecting debts from welfare recipients, who’d under reported the earnings they were making in the private sector whilst still on payments in order to collect more welfare than they were owed.

But, as the commissioner continues, it was Scott Morrison, who, when appointed minister for social services in January the following year, really ran with the idea of cracking down on welfare rorters, as he saw himself as a “strong welfare cop on the beat”.

From there, Human Services employees patched together a computer-driven system, which wouldn’t incur staffing costs, and would average out fortnightly earnings recipients had declared over the number of months they were receiving assistance and calculate if they were overpaid.

Recovering rough estimates

The major problem with Robodebt was its reliance on income averaging, which produces flawed results.

Under the Centrelink payment scheme, those working part time for uncertain periods can declare what they’ve earnt and still retain part of their welfare payments, or otherwise forgo them totally for a period, whilst receiving money for the hours they’ve been working for an employer.

As “in-house” government lawyers and an inquiry informed the department prior to the launch of Robodebt, averaging out fortnightly payments over a longer period of unemployment can result in the appearance that a debt is owed to the welfare agency even when this isn’t the case.

And as Holmes explains, there were debt recovery processes carried out by Centrelink prior to Robodebt, that had been based upon fortnightly calculations, with actual human staff oversighting of such claims, which ensured that any debts raised against recipients’ names were correct.

The commissioner listed reasons why Robodebt differed to its predecessors, which included sole reliance on tax office PAYG data, which isn’t a fortnightly system, along with recipients having to prove their innocence or be lumbered with an automated false debt plus a 10 percent penalty.

“There were other fundamental unfairnesses in the program. No regard was had to the sheer unreasonableness of placing the onus on recipients to attempt to establish what their earnings were for periods going back as long as five years,” Holmes further outlined.

And after testing the system to a degree using actual human staff to oversee trials, the online system was fully rolled out in September 2016, without any further consideration to watch out for unresolved problems that did occur, such as the deletion of certain data and mismatching of details.

“The effect on a largely disadvantaged, vulnerable population of suddenly making demands on them for payment of debts, often in the thousands of dollars, seems not to have been the subject of any behavioural insight at all,” the commissioner added.

Sticking to its deadly resolve

The disastrous effects of Robodebt were known within months. Holmes notes that the human impacts were being reported by early 2017, with “families struggling to make ends meet receiving a debt”, “young people being driven to despair” and, “horribly, an account of a young man’s suicide”.

Indeed, the Australian Council of Social Services (ACOSS) had written to inform Human Services of the fallout by December 2016, however such information led that department and Social Services “to double down” and go on to attack the media for propagating falsehoods against the system.

The commission also found that the Commonwealth Ombudsman’s April 2017 report into Robodebt had, whilst making some minor suggested changes to it, served to legitimise the scheme, despite no legislative amendments having been made to provide Robodebt with any legal foundations.

So, rather than act as a safeguard to the public against an overreach of government, the Ombudsman permitted the department and ministers to fall back upon its findings to serve as justification for a highly flawed government scheme that was causing havoc in the community.

Holmes found that despite cases being taken to the Administrative Appeals Tribunal repeatedly finding that debts scrutinised were faulty due to the utilisation of income averaging as it produces false figures, these cases were dealt with on a single basis and the overall pattern was ignored.

And it wasn’t until a Federal Court ruling determined Robodebt to be flawed due to its use of income averaging, and this decision was then further supported by the Australia solicitor general in a second decision of that court that this system was brought to an end in June 2020.

“Robodebt was a crude and cruel mechanism, neither fair nor legal, and it made many people feel like criminals,” ends the report’s general overview.

“In essence, people were traumatised on the off-chance they might owe money. It was a costly failure of public administration, in both human and economic terms.”

Debt-collecting still a government pastime

But as the Antipoverty Centre outlined in a statement on the same day that the Royal Commission report was released, the Albanese government may not be using income averaging, but it continues the “aggressive pursuit of welfare recipients”, with the same demonising qualities as Robodebt.

The centre points out that in the month after it came to office, the current federal Labor administration made the claim that one in five JobSeeker recipients have received a wrong payment, implying “mass fraud in the welfare system” continues to be an issue.

And in its most recent annual report, Services Australia, formerly the Department of Human Services and that of Social Services, outlined that fraud within the welfare system has recently led to 709 criminal investigations with a further 988 administrative cases and 203 referrals to the CDPP.

According to the Antipoverty Centre, Services Australia is now hunting down more than a million people over debts worth an estimated $5 billion, and yet, this agency well understands that this demonisation of some of the nation’s poorest has led to tragedies in the past and is likely to again.