Less than a fortnight after two senior public servants told a royal commission how they developed the robo-debt program using the “science” of behavioural insights to “influence” welfare recipients, the division at the National Disability Insurance Agency where these officials now work is expanding its compliance branch using the same strategies.
In a job advertisement posted on November 14, the NDIA’s compliance program branch, led by Jason Ryman, is seeking an assistant director of behavioural insights to work exclusively on projects that “address potential and actual non-compliance by participants and providers”.
The advertisement states that the roles will “lead and manage research to ensure the delivery of innovative and effective behavioural interventions that align to the strategic priorities of the Agency.
“It will draw on your understanding of human behaviour and behavioural economics to understand how people make decisions and behave, and apply this to inform service delivery, programs, and policies.”
There are more than a few striking similarities between the circumstances within the Department of Human Services (DHS), which incubated what would become known as robo-debt – an automated policy trap designed to rake in cash from welfare recipients for debts that never existed, who were in turn devastated by the process, which then ended up costing the Commonwealth $1.8 billion in a legal settlement – and the current outlook at the NDIA.
Chief among them are the numbers of payments being made to people and a management desire to achieve savings or restrain costs.
In this regard, the former leadership of the NDIA together with then Coalition ministers Stuart Robert and Linda Reynolds came up with a moonshot package of “reform” to rewrite the legislation, hand more control back to the federal government by diminishing state and territory influence and force hundreds of thousands of participants to be assessed for functional capacity by “independent”, government-contracted doctors and therapists. Although they denied this would lead to cost-cutting in participant plans, projected savings leaked to the media revealed the executives hoped to book at least $700 million in funding reductions in the first few years of the scheme.
A draft of that National Disability Insurance Scheme (NDIS) legislation, with tracked comments from agency staff, was obtained by The Saturday Paper. It shows Jason Ryman, who was seconded to the NDIA from DHS after robo-debt began, marking up changes with his approval and questions in January last year.
One key proposed change was an additional section that sought to outlaw the use of NDIS funds on “ordinary living expenses” or goods and services that the “minister considers are more appropriately funded or provided” through state and territory support systems or services.
Ryman was enthusiastic about this draft change.
“Funding not to be used for certain purposes – the clear reference an amount spent in contravention of this subsections is a debt is a positive,” he wrote in annotations attached to the document.
“The drafting of the rules of what is an ‘ordinary living expense’ or ‘goods and services specified in the rules’ should provide us with a basis for making determinations of non-compliance and remove some of the questions of what is allowable / not allowable with the removal of the term ‘reasonable and necessary’.”
Ryman was supportive of another change, linked to this section, that would raise a debt against a person who breached these rules.
“Provides clarity in terms of who the debt is against, (the recipient who receives the money and does not spend in accordance with the Act),” he wrote.
Senior public servants across every level of government had tried and failed for nearly eight years to delineate which jurisdictions were responsible for picking up which costs in the split between NDIS and other service systems such as health and education. Under the new rules, that judgement was expected to fall on people with disability using the NDIS, and if they got it wrong the debt would be theirs to pay.
It was Jason Ryman who authored the June 24, 2014, paper that went to his then boss at the Department of Human Services (DHS), Scott Britton, outlining the early concepts for robo-debt. This document, discovered by the Royal Commission into the Robodebt Scheme, shows that a core feature of robo-debt was present from the earliest stages: the reversal of the onus of proof.
Under the “trusted data assessments” proposed in the brief signed by Britton six days later – Britton is now branch manager of fraud intelligence and investigations within the same division as Ryman at the NDIA – it was clear that Ryman and colleagues proposed matching annual taxation office data with reported income by social security recipients and averaging it out over 26 fortnights to find “discrepancies”.
This was then automatically sent to customers who were obliged to go online – there was no phone number to call in the earliest iterations – and fight a battle they couldn’t hope to win because the tax office data was given primary weight as evidence.
Debts raised by DHS increased by double-digit percentages.
In the furore that attended the public fight to dramatically remake the foundations of the disability insurance scheme, state and territory ministers refused to acquiesce and the vast majority of the legislative changes, including Ryman’s preferred options, were dropped. However, it is clear from the latest financial sustainability report, released this month, that this remains a sore point internally. “Significant pressures on the financial sustainability of the Scheme remain and have become more significant,” the report says.
“There are few substantive legislative, policy or operational responses currently planned to mitigate upward cost pressures.”
A senior employee of the NDIA who is familiar with the workings of the division where both Britton and Ryman work says hunting down fraud is very different to some conceptions of compliance.
“The very clear problem to me is that the agency [NDIA] has a long history now of telling participants things that are just not true in the hope that they will not fight a decision,” this official says. “Say, for example, they might deny funding for a particular therapy or for travel, or cap support hours. What we see, if a person decides to take on the very onerous task of challenging that decision, is that these frequently get overturned at the Administrative Appeals Tribunal. In other words, the agency was wrong to make the decision it did.
“This is the same thinking that underpins compliance. And when we are talking about using behavioural insights to enhance that, we are talking about using psychological tricks to discourage certain behaviours. What I want to know is whether we are discouraging people from claiming support to which they are entitled.”
Earlier this month, Disability Advocacy NSW, along with organisations including the Rights Information and Advocacy Centre and Villamanta Disability Rights Legal Service, made a submission to a joint standing committee inquiry into the capability and culture of the NDIA. It was scathing.
“In the context of rhetoric suggesting that the NDIS is too costly, we see numerous complaints made about access requests denied, inadequately funded plans and plans being unfairly slashed,” the submission says.
“This ultimately leads to people with disability having to fight for reasonable and necessary supports and services through the internal and external reviews processes.
“As we have stated previously, this fight is an unfair battle, as legally unrepresented people with disability are confronted with adversarial behaviours from the agency and their legal representatives. The NDIA disproportionately holds the power, the resources, and is under no time pressure. In contrast, the individual often has necessary disability supports withheld from them and little or no capacity to negotiate.”
The authors of this submission note there has been a “distinct shift” in the way funding decisions are made with a “marked decrease in transparent decisions”. Notably, the agency has even published “misinformation on the NDIS website regarding what they will and will not fund”.
According to disability consultants DSC, the NDIS has published at least 36 different “myths” on the website page “Would we fund it” about things it will apparently not cover but that have already been allowed under appeal at the AAT.
“This is what they are doing publicly to discourage people from asking for support,” an NDIA staff member said. “What are they doing that we don’t know about?”
In the attached position description for the assistant director role advertised this month, applicants are told a core responsibility will be “designing and delivering behavioural insights projects on time” and embedding these insights “into program design across the Compliance Program Branch by randomised controlled trials and other empirically sound quasi-experimental interventions, combining data analytics and business insights, informing decision making and advancing the capability across the Agency”.
Under questioning at the royal commission on November 8, Jason Ryman acknowledged it was a deliberate decision to send letters to robo-debt victims that did not include a phone number for them to contact someone for help. “I recall that the phone number wasn’t included because we were really seeking customers to go online,” he said.
Commissioner Catherine Holmes was more direct. “To minimise human involvement, effectively?” she said. “No phone numbers in order to minimise compliance officer engagement.”
When Ryman repeated his earlier answer, Holmes became even more direct: “Okay. You didn’t want them ringing up. Is that right or not?”
Earlier, Ryman had noted that his branch were “trialling … or looking at different letters that we could use, incorporating behavioural insights to influence compliance behaviour”.
Asked later whether they specifically used these “behavioural nudges” to draft the letters, Ryman said he could not recall but acknowledged they had sought general advice around how to get people to go online.
Scott Britton, his then boss and now peer at the NDIA, told the inquiry they were involved in “influencing” users’ behaviour.
“This is, again, at the very early stages of the use of behavioural insights. So, the content of the letter, the language of the letter [was] different to the normal approach that was taken, particularly by DHS and former iterations,” Britton said. “It was a bit less directive as well. So, looking at how we can – that’s why I used the word ‘influence’ – influence rather than direct.”
Even before the Online Compliance Intervention began – one of the early names for robo-debt – a then colleague of Ryman’s at DHS emailed him to check an assumption.
“Thanks, Jason. We are going to have a percentage of customers that do not contact despite our invitation, and these customers will have their debts raised regardless,” Owen Lange wrote in an email on May 6, 2015.
Ryman confirmed this during his response later that day.
“Hey Owen, you are right in your assessment,” he said. “One of the unknowns is how many will not contact and then how many will contact after being advised of the debt via letter. What we are thinking is those who choose not to contact are satisfied with the information in the letter and the process we will apply in calculating the debt.”
Later that year, in October, Ryman got in touch with colleagues at the Department of Social Services and, in an email, raised the prospect of “utilising the [debt] recovery fee as a lever to influence customers to enter into a recovery arrangement at that point”.
By June 2016, as robo-debt was about to accelerate to 90,000 data matches, DSS assistant director of payment integrity Kristin Lumley emailed colleagues at DHS, including Ryman, about the application of this debt recovery fee and precisely how it would be applied via an online portal. After seeking clarification from DHS, she relayed what she had discovered back to her own colleagues when seeking legal advice from principal lawyer Anne Pulford.
“The online compliance interaction through myGov is a key component of this measure that enables the significant increase in compliance activity and cost savings by removing the need for staff decision making,” Lumley wrote.
“I understand that past experience shows that if an alternative phone number is provided a significant proportion of recipients will not engage online.”
DHS knew this, which is why it drafted different letters and only sent one with a contact number to a very small cohort of vulnerable or extremely remote welfare recipients. Everyone else was deliberately led through an online process, which DHS knew, from its development trials, would result in as many as half making no contact. In such a circumstance, a debt was automatically raised.
This was the spark of cunning that was informed by behavioural insights and applied to a program that was in full operation by September 2016. In his statement to the royal commission, Jason Ryman said he and his team were still working out issues with a sample of 1000 cases under the Online Compliance Intervention “soft launch” when there was a decision “that was not made by me to launch approximately 90,000 cases through the OCI”.
Ryman said that at the time the decision was made he was still working through issues and feedback from the initial sample of 1000 cases.
“I recall that I voiced my concerns at the time,” he said. “By running additional and significant volume through the system, my view at the time included that we had not been afforded a sufficient opportunity to iron out any bumps.
“My concerns also included that the decision to feed additional and significant volume through the system may have been in response to significant performance expectations, which had costs savings attached to it.”
There is now pressure at the NDIA to rein in expenses which, although it has been systematically wrong in the past on costs, it forecasts will hit more than $50 billion a year by 2025-26 – a jump in costs as a percentage of GDP from 1.48 per cent this financial year to 1.93 per cent in three years.
The new minister for the NDIS, Bill Shorten, who campaigned against the “robo-planning” cost-cutting of the agency under the previous government and established the robo-debt royal commission, announced a review of the scheme last October. It will be co-led by the NDIA’s first board chair, Bruce Bonyhady, and former senior public servant Lisa Paul.
Part of the review’s remit is to look at areas of waste.
A spokesperson for the NDIA said it “would be wrong to link the Agency’s compliance work – which actively works to protect the funding of NDIS participants – to the focus of the current royal commission”.
In a statement, the spokesperson said: “Agency compliance activities are ethical and consistent with our commitment to focus on the welfare of participants at all times.”
The job advertisement for an assistant director of behavioural insights closes on November 30.
This article was first published in the print edition of The Saturday Paper on November 26, 2022 as "Exclusive: Robo-debt ‘insights’ to shape NDIS compliance".