Read The Times Australia

Daily Bulletin

Robodebt compensation is a win for victims, but now we may never know the full story

  • Written by: Christopher Rudge, Lecturer in Law, Sydney Law School, University of Sydney

The news of the largest-ever class action settlement in Australian history seems, in many ways, like the only fitting bookend to the awful ordeal of Robodebt.

Some A$548 million (including legal and administrative costs) will be paid to more than 433,000 victims, once the settlement is approved by the Federal Court.

It’s undoubtedly a win for victims, who’ve spent years fighting for compensation for the trauma they experienced as a result of the Robodebt scheme. Lawyers representing them said it was “day of vindication and validation”.

But now the matter won’t go before a court. Without the piercing gaze of the law and judiciary, there are many questions of government and public service accountability that may never be answered.

We may never know the full Robodebt story.

Years of litigation

Robodebt was a debt-recovery system run under Coalition governments from 2015 until 2019. Designed to secure budget “savings”, it used an unlawful method of income averaging to issue false debts to welfare recipients.

The program unlawfully “withdrew” a predicted $1.76 billion of repayments from welfare recipients, and actually recovered at least $751 million, before it was conceded, in a first settlement, that these debts were unlawfully raised and erroneously calculated.

This compensation settlement will resolve a second class action lawsuit, brought against the government of the day for past wrongdoing. But the quest for justice has been wider.

This class action, an appeal of the first one, was launched after the damning findings of the royal commission.

In 2023, when handing down its final report, the commission described the Robodebt scheme as:

[…] a crude and cruel mechanism, neither fair nor legal, and it made many people feel like criminals. 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.

Unlike the first class action settlement in 2020, which provided refunds with interest, this payout will provide financial compensation to victims.

It takes the total government bill to staggering heights. If you add up the first class action settlement, the foregone revenue the government had baked into budget projections, and this latest settlement, the total liability of the Commonwealth for this single policy failure approaches $2.43 billion.

What was the legal challenge about?

Though the new class action had not reached the point where full claims had been filed, the litigation was slated to introduce into court the “damning evidence” of wrongdoing uncovered in the royal commission.

A man and a woman look at the camera while holding a large stack of papers
Commissioner Catherine Holmes, pictured delivering the Robodebt report to Governor-General David Hurley in 2023. Mick Tsikas/AAP

The victims’ lawyers stated this evidence was not available and had not been made available by the government during the original class action proceedings in 2020.

Lawyers for the victims had planned to argue this new information supported claims of a specific and serious civil wrong: misfeasance in public office.

What is public office misfeasance?

As a legal wrong, misfeasance is unique. It’s the only one that applies exclusively to public officials who misuse their public power.

The common law recognises that public officials always owe a duty not to abuse their powers because of their obligation to act in the public interest.

The misfeasance tort (a civil wrong) therefore targets the deliberate betrayal of that duty. This is known as “conscious maladministration”.

Read more: Explainer: what is the 'tort of misfeasance' and how might it apply in the case of robodebt?

To prove misfeasance, it’s not enough to show incompetence or a mistake, even a catastrophic one.

Lawyers for the Robodebt victims would have needed to prove specific states of mind held by public officials. They would have had to prove the officials acted recklessly, indifferently or with targeted malice.

Although such settlements are typically reached on the basis that no fault or admissions are made, it’s fair to infer from the settlement that the government regarded the lawyers’ claims with a degree of seriousness.

The government had not, for instance, applied to get the legal claims dismissed.

Why did the government settle?

The decision to settle was likely driven by a combination of legal and political factors.

The evidence unearthed by the royal commission significantly strengthened the victims’ case for misfeasance. A trial would have been risky and potentially even more costly, with the prospect of further damaging revelations emerging in court.

Politically, settling the case allows the current government to draw a line under a scandal that plagued its predecessors. It can frame the payout as a necessary step in righting the wrongs of a “disastrous and heartless” policy.

How the settlement figure was calculated, and what it represents, is not yet, and may never be, clear.

Empirical studies on class actions have shown settlement amounts rarely match the actual damage caused.

Instead, they usually reflect a mix of the estimated damages, litigation risks, insurance coverage, and the strategic interests of both sides to avoid further costs and uncertainty.

However, the large size of this settlement suggests the government has not adopted a “nuisance-value” strategy, where payment is made to efficiently resolve an otherwise meritless claim.

Still, it should be remembered that the large size of the total settlement reflects the size of the cohort, not necessarily the generosity of the compensation. When the millions are divided among more than 433,000 people, the individual awards to victims may be reasonably criticised as modest.

The lingering questions

With the misfeasance claims dropped, there will be no legal finding on whether public servants knowingly acted unlawfully.

This leaves a crucial gap in the public’s understanding of precisely what kind of legal culpability the alleged wrongdoers may have had.

Indeed, other systemic issues that might have been raised, such as evidence suggesting members of the historic Administrative Appeals Tribunal were penalised or terminated for making decisions against the government, will remain untested.

The case has one final frontier: the National Anti-Corruption Commission (NACC).

Earlier this year, the NACC committed to investigating the six referrals it received from the Robodebt royal commission.

This was after initially choosing not to investigate the referrals, which resulted in multiple independent investigations into the watchdog itself and around 1,2000 public complaints.

It’s been a fraught process to get to this point, and there is no public timeframe for the conclusion of its investigation. Its proceedings are also typically held in private to avoid prejudicing any potential future legal action.

While the NACC can recommend criminal charges, it cannot prosecute individuals itself.

Whether we will see substantial findings from its investigation remains to be seen. It’s the last chance to investigate the key public officials behind Robodebt, and if necessary, hold them to account.

Authors: Christopher Rudge, Lecturer in Law, Sydney Law School, University of Sydney

Read more https://theconversation.com/robodebt-compensation-is-a-win-for-victims-but-now-we-may-never-know-the-full-story-264587

Business News

How Telematics Helps Australian Companies Improve Productivity

Operating a commercial fleet in Australia is a uniquely demanding endeavour. Between the sprawling urban sprawl of cities like Sydney and Melbourne and the immense, unforgiving stretches of the Outb...

Daily Bulletin - avatar Daily Bulletin

Inside the Icon: The BridgeMuseum Officially Opens at the Sydney Harbour Bridge

A bold new way to experience one of Australia’s most recognisable landmarks has arrived, with BridgeClimb Sydney officially opening the all-new BridgeMuseum.  Located inside the Sydney Harbour Brid...

Daily Bulletin - avatar Daily Bulletin

Is Your Brand Showing Up in AI Search? Most Melbourne Brands Aren't.

The New Front Door Nobody Told You About Something changed. Quietly. Without a press release. The way buyers find businesses in Australia has been rewired. Not replaced, rewired. Google isn't dead...

Daily Bulletin - avatar Daily Bulletin

How Australian Businesses Can Measure SEO ROI

SEO can feel vague when you are staring at a dashboard full of numbers that do not clearly connect to revenue. The key is to measure the right signals in the right order, then tie them back to outcome...

Daily Bulletin - avatar Daily Bulletin

How Commercial Roller Shutters Improve Site Security Without Slowing Operations

Security upgrades can be frustrating when they make everyday work harder. A door that takes too long to open, creates bottlenecks at shift change, or fails at the worst time can turn “better protectio...

Daily Bulletin - avatar Daily Bulletin

Why a Document Destruction Service Still Matters for Modern Businesses

Businesses generate large volumes of information every day, from staff records and contracts to invoices, reports and customer files. While attention often focuses on how documents are stored, the way...

Daily Bulletin - avatar Daily Bulletin

Bicycle Rack Safety and Space-Smart Storage

Bike storage problems usually show up as small annoyances first: tangled handlebars, scratched frames, and bikes that topple when you pull one out. Over time, those issues become safety risks, especia...

Daily Bulletin - avatar Daily Bulletin

How to Tell if a Childcare Centre Is a Good Fit for Your Child

Choosing childcare can feel like you’re making a huge decision with limited information. Tours are short, centres are often on their best behaviour, and your child might act differently in a new space...

Daily Bulletin - avatar Daily Bulletin

Car Import Timeline: What Usually Happens at Each Stage

Importing a car into Australia can feel confusing because multiple agencies and checkpoints are involved, and the timeline is shaped as much by paperwork quality as it is by shipping speed. The most u...

Daily Bulletin - avatar Daily Bulletin

The Daily Magazine

Gold Migration Lawyers in Liquidation: How the Closure Affects Your ART Appeal

If your appeal was with Gold Migration Lawyers, a recent change to how the Tribunal decides cases ...

The pressure cooker: life in urban Australia in 2026

Australian cities have always been demanding. Long commutes, rising housing costs, busy schedules a...

What Actually Makes a Good Criminal Lawyer in Melbourne

Most people only think about this question once. That is usually too late. Most people charged wi...

Why Working With A Chatswood Tutor Can Improve Academic Performance

Academic expectations continue increasing for students across primary school, high school, and senio...

Is It Worth Getting Solar Panels in Melbourne?

The real question is not whether solar works in Melbourne. It works. The question is what it is co...

How A Diploma Of Project Management Builds Practical Skills For Modern Work Environments

Developing the ability to plan, execute, and deliver outcomes efficiently is a key requirement in to...

How to Choose the Right Football for Every Level

Choosing a football may seem straightforward, but the right option depends on who will be using it a...

What to Ask a Wedding Photographer Before You Book

Booking a wedding photographer can feel deceptively simple: you like the photos, you like the vibe...

Why Stress Relief For Dogs Is Essential For Emotional Balance And Long-Term Wellbeing

Managing emotional health is just as important as physical care when it comes to pets, which is why ...