It should have been obvious to a top ACT public servant to doubt the lawfulness of the robodebt scheme while he was leading an investigation as acting Commonwealth Ombudsman, a royal commission has found.
The decision not to commission or recommend obtaining external legal advice on the scheme amounted to a failure to "confront a fundamental issue in the investigation".
Richard Glenn, the now director-general of the ACT's Justice and Community Safety Directorate, did not include concerns about the legality of the income-averaging debt recovery process in a 2017 investigation report.
The royal commission found that report "through abstention from comment and a lack of clarity, gave the scheme a veneer of legitimacy which enabled it to continue".
"The fact is that the 2017 own motion investigation did more harm than good. It gave those wanting the scheme to continue unexamined a shield against criticism from advocacy groups, the media and political opponents," the royal commission found.
Mr Glenn was acting Commonwealth Ombudsman between January and April 2017, when the body was investigating the Human Services Department's robodebt scheme.
"Mr Glenn did not take any of the possible steps to have the question of legality resolved. But that should not have prevented him from including the draft legality text in the 2017 Investigation Report," the royal commission found.
The report of a royal commission into the scheme were released on Friday morning, which made 57 recommendations.
An additional sealed chapter recommends the referral of individuals for civil and criminal prosecution.
More than $750 million was wrongfully recovered from 381,000 people under the unlawful scheme operated under the former Liberal-National Coalition government.
The scheme matched Centrelink records with averaged income information from the Australian Taxation Office in an effort to identify overpayments and issue debt notices.
The inquiry, led by former Queensland chief justice Catherine Holmes, was set up in August 2022, three months after the Labor government was elected.
In his role as acting Ombudsman, Mr Glenn reportedly had doubts about the legality of the scheme but did not raise them.
Mr Glenn told the commission "on the material before me, I was not satisfied that we could make a declaratory statement, and I chose not to comment on legality".
"My thinking was influenced by the fact that I couldn't make a clear determination one way or the other about legality," he said.
"The advice that I was receiving from the team was that they were concerned, but we couldn't land a crisp, contrary view."
However, the royal commission found there were at least seven reasons to doubt whether the scheme was legal, including "critically" that Mr Glenn's own staff were unconvinced by legal advice from the Social Services Department.
"In those circumstances it should have been obvious to Mr Glenn that there was substantial reason to doubt the lawfulness of income averaging as it was used in the scheme and any assertion by either department that it was lawful," the royal commission's report said.
"That begs the question whether he should have taken steps to resolve the legality issue or, failing that, retained the wording in the draft report which concerned the legality of the scheme."
The Commonwealth Ombudsman's office - under the leadership of Mr Glenn - did not take steps available to it to commission external legal advice into the scheme, the royal commission found.
"In circumstances where there was a live question about the legality of averaging in the scheme not satisfactorily answered by anything produced by [the Human Services Department or the Social Services Department], the Ombudsman should have seriously considered the possibility of obtaining advice from the [Australian Government Solicitor] or at least should have made the formal recommendation that [the Human Services Department] obtain advice from an external provider," the royal commission report said.
The scheme was ruled unlawful by the Federal Court in 2019 and a settlement of $1.2 billion was reached between robodebt victims and the former government.
The Canberra Times asked ACT public service head Kathy Leigh whether Mr Glenn would remain in his post and if any action would be taken following the findings of the royal commission.
An ACT government spokeswoman said: "The ACT government is aware of the report tabled today and will take the appropriate time to review it."
"Integrity is one of our core values and Canberrans can have confidence we uphold these values within the ACT Public Service," she said.
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