Welfare advocates say budget-saving measures by successive Liberal governments created an environment where those on social welfare were made to feel like criminals.
Chief executive of the Australian Council of Social Services Dr Cassandra Goldie appeared as a witness before a royal commission into the failed robodebt scheme in Brisbane on Friday.
She described measures introduced under former prime minister Tony Abbott in 2014 as "horrific" for people on low incomes.
"There was a May 2014 budget handed down by the then Abbot government which was widely known to be a horror budget, and then May 2015 there were further measures added to that," she said.
Those measures became the foundation for the robodebt scheme which was estimated to save the federal budget $1.2 billion.
Robodebt involved using individuals' annual tax information provided by the ATO to determine average fortnightly earnings and automatically establish welfare debts, an approach ruled unlawful by the Federal Court in 2019.
The scheme wrongly recovered more than $750 million from 381,000 people and led to several people taking their lives while being pursued for false debts.
Dr Goldie said rhetoric used by the government at the time was interpreted by her and others as a way of prompting the debts to be paid without question for fear of punishment.
"You have a government that was using language about being a 'welfare cop' using language about 'we will come after you'," she said.
"This notion of the Department of Human Services or Centrelink being there to help people was the complete opposite of what the government was actually communicating."
The commission also heard from single Mum, Sandra Bevan who works in aged care and disability support and was pursued through robodebt for incorrect debts of close to $3000.
"They may as well have been asking for a million dollars really, there was no way I could pay that amount," Ms Bevan told the commission on Friday.
"I remember driving home at night beside myself with worry about this money.
"And I thought I could just drive my car into a tree to make it stop. But my kids needed me."
Dr Goldie and others from her organisation met with human services minister at the time Alan Tudge in 2017 and pleaded with him to end the program immediately.
ACOSS Program Director for Social Security, Charmaine Crowe also appeared as a witness on Friday and told the commission the government had fundamentally failed in its duty of care to do right by its citizens.
"They unleashed this scheme on hundreds of thousands of people causing widespread distress," Ms Crowe said.
"They knew about the distress the scheme was causing, they knew about that right from the start and yet they continued."
Scott Morrison told the commission on Wednesday the government had a strong desire to balance the budget and that social welfare made up roughly a third of total government spending.
"We need to be fair to those that receive benefits as well as those who pay for them - taxpayers," Mr Morrison said.
"That was a very strong view of our government and the principle of mutual obligation which was established in particular by Prime Minister Howard."
He said reducing "rorts" from the system was a main priority in taking on the portfolio as it had been for him as immigration minister before that.
"I knew from my previous experience with immigration that any government program has challenges dealing with integrity issues," he said.
"Some of those are intentional, some are unintentional."
