One of two architects of Robodebt says he was not aware of concerns from the Department of Social Services (DSS) about the scheme's potential illegality shortly before it was rolled out.
Ex-Department of Human Services (DHS) compliance and risk branch director Jason Ryman was responsible for the scheme, which was designed to save money for the former Coalition government.
Mr Ryman told the inquiry, which is holding hearings in Brisbane this week, he did not agree the concept of income averaging was a new way of doing business but conceded it had only previously been done at a "lot smaller rate", and as a last resort.
The inquest heard about a brief that had been prepared by DHS to then-social services minister Scott Morrison in 2015, that advised "DSS [Department of Social Services] strongly advised against the proposal".
Counsel assisting the commission Angus Scott KC said DSS lawyers said Robodebt "does not accord" with social security legislation that says income is to be assessed fortnightly.
But Mr Ryman told the inquiry he was not aware of briefings to this effect.
"The effective legal advice was that what was proposal was unlawful?" Mr Scott asked, showing Mr Ryman a document.
Mr Ryman replied: "It's clear they're saying it doesn't accord with legislation."
Mr Scott continued: "Which means it's unlawful?"
"Yes," Mr Ryman agreed.
The commission heard Mr Ryman penned an email to DSS with dot points about why he believed the Robodebt scheme was lawful.
He denied seeing the earlier brief, which indicated the concerns from DSS about the potential illegality prior to writing the email.
Instead, he said he was asked by a colleague, Scott Britton, to prepare the email.
He could not recall the reason other than that he had been asked to tell DSS "why we think we can do this".
In the email shown to the commission, Mr Ryman had asked a colleague above the dot-point document: "Hand on heart time – any exposure?"
But Mr Ryman said he was referring to whether he'd "articulated something incorrectly".
"What I suggest it indicates is that you recognise the response had some serious implications, do you accept that?" Mr Scott asked.
Mr Ryman disagreed.
'Command and control' management
Earlier, former chief counsel at the Department of Human Services (DHS) Tim Ffrench on Wednesday told the inquiry being held in Brisbane that if he had been in the top legal job at the department in 2017, he would have sought further legal advice about Robodebt following criticism from an eminent barrister about the lawfulness of the automated scheme.
Mr Ffrench was the chief counsel at DHS between 2019 and 2020.
The inquiry earlier in the day heard department lawyers in 2017 attended a legal conference where top constitutional silk Peter Hanks KC gave a presentation and warned Robodebt's method of calculating debts was illegal, because it involved income averaging.
Former DHS general counsel Matthew Roser on Wednesday told the commission legal advice was not sought in 2017 to provide clarity following Mr Hanks's keynote speech even though it generated "discussions" among senior lawyers.
The inquiry, which is investigating the automated debt recovery scheme that was found to be illegal after thousands of people were issued incorrect bills, heard no advice relating to the lawfulness of Robodebt was sought until 2019.
Mr Scott asked Mr Ffrench whether he would have "strongly recommended" the DHS secretary to obtain legal advice had he been in the chief counsel role in 2017.
"I think it's a reasonable statement to make that when there was a significant amount of adverse criticism, accompanied by academic criticism, of the scheme it would have been prudent for the department to gain advice about the legality of the scheme, so I think the answer to your question is 'yes'," Mr Ffrench said.
He said the dynamics of DHS in 2017 were such that it was run with a "command and control approach to the management of the department".
Mr Ffrench was asked by Commissioner Catherine Holmes KC what may have stopped the chief counsel at the time from seeking of legal advice in 2017.
"There was a different secretary in 2017, that may have inhibited or dissuaded people from providing the advice," he said.
Culture 'not conducive to a proper examination of issues'
Mr Ffrench was also asked to "comment then on what the dynamics in the department were like in 2017" given he was working within DHS in another role.
"It's a short question but a big one," Mr Ffrench said.
"I think the dynamics in 2017 were not the kind … we're talking about culture, I think, culture and leadership … those things at the time were not conducive to a proper examination of issues relating to this particular program [Robodebt] given that I think many people were determined to achieve a particular outcome for government and once they'd reached that state of mind I think that the honest inquiry into issues like the ones you are raising was not something that was fostered by that culture.
"I believe that the culture and environment at the time prevented people from asking questions that should have been asked because of fear that those questions would be seen as potentially impertinent, unnecessary or the people asking those questions may have been presented as blockers to the achieving of those objectives," he said.
Earlier in the day, Commissioner Holmes suggested lawyers within DHS had made the decision to "hunker down" and hope they were not "sued" despite being warned the scheme was unlawful.
Mr Roser disagreed with this suggestion, saying: "I don't think that, with respect, commissioner."
She later repeated her comment saying: "Sounds pretty much like hunkering down and waiting until they sue because no steps were taken in response to this, were they?"
Mr Roser replied said from the stand: "Certainly not by me, commissioner."
The inquiry continues.
