Whistleblowing reforms show the hopes and risks for Australian politics

By A J Brown

Tuesday February 19, 2019

Woman with documents sitting on the desk, in office

Today’s overhaul of private sector whistleblower protections provides a glimmer of hope for the strong, bipartisan integrity reforms Australia needs… if and when we are prepared to lift our sights.

Transparency International’s Corruption Perceptions Index has shown Australia continues to play catch up on integrity and anti-corruption, when we used to lead. And the nation is descending towards a plainly dreadful election.

Other reforms have also stalled or become fractious – the national integrity commission, parliamentary integrity and political donations, foreign bribery, anti-money laundering, company ownership transparency, lobbying and ‘revolving doors’ to name a few.

However, the parliament’s unanimous support for improved whistleblower protections shows it doesn’t have to be this way. We can address these issues, and lead again.

The new Corporations and Taxation law amendments are just the first step in implementing a political consensus reached in last year’s landmark parliamentary inquiry – but they are a big one.

Until now, few people even knew Australia had any whistleblower protections for corporate employees. They were an ineffective imitation of already weak US laws, created in 2004.

In 2009, Labor’s Assistant Treasurer, Chris Bowen started a review of the laws, but never finished it.

Eventually, inquiries into the performance of ASIC and the cases leading to the banking royal commission triggered a complete overhaul.

In 2016, it was Minister for Financial Services, Kelly O’Dwyer who took a government thought-bubble about protecting tax whistleblowers, and began dealing properly with years of inaction.

The stakes then lifted when the Nick Xenophon Team and (now) Centre Alliance Senator Rex Patrick struck a deal to not only copy, but surpass our public sector whistleblowing laws, and put Australia back in the lead.

The results will better protect whistleblowers in a myriad of ways.

Reportable wrongdoing has been massively expanded and clarified. Not only employees, but contractors, volunteers and others are covered.  Civil remedies and confidentiality protections have been created, widened or made more accessible.

After negotiations with Centre Alliance, the Government bill became world leading, in two respects.

First, legal protections do not only kick in after a whistleblower starts to experience reprisals. Only taking action on reprisals after the event is like giving a band aid to an amputee – by the time compensation rights are triggered, it is usually too late.

Now, all public and large proprietary companies are required to have whistleblowing policies which spell out how they will “support and protect” those who speak up before they begin to experience any detrimental effects.

This culture-changing step is crucial. Many companies are good at getting their employees to reveal wrongdoing.  Their problem is knowing how to actually protect them, when they do.

Second, backing this up, a company can now be held liable if it fails in its duty to prevent detrimental acts or omissions – such as by having no support plans, or neglecting to implement them.

Again, granting whistleblowers the right to sue for such a failure is a world first.

Rules for whistleblowing outside the organisation also set a new benchmark. If employees blow the whistle at least to a regulator, and nothing is happening in 90 days, or there are emergency circumstances, it’s relatively simple for them to go public and still be protected.

In the European Union, by contrast, some countries are still arguing that employees must always blow the whistle internally first, or forfeit all protection.

Of course, the new rules will need to be tested in court, to be sure they are working. And there is more to be done, as recommended by all parties in the 2017 parliamentary inquiry.

Recently, Labor announced it would continue the process, promising a single over-arching Act, a financial reward scheme, and a much-needed whistleblower protection authority.

But promises need to be backed by action.  So far, Labor is only committing a grand total of five new public service positions to this huge task – a drop in the ocean compared to what is needed.

Indeed Labor’s promises about a national anti-corruption agency suffer the same problem. The Opposition has pledged only half of what the Government proposes to spend on its own, narrower Commonwealth Integrity Commission proposal. As yet, neither side is committing to properly protect whistleblowers as part of their plan.

Integrity reforms are no ground for window-dressing, or short term political point-scoring. Converting Australia from a backslider to once again a leader, takes a lot more foresight and stamina.

However, as a major first step, these new whistleblowing laws show it is possible. Even amid today’s fractious politics, with bipartisan support and true commitment, rhetoric can become reality.

A J Brown is professor of public policy and law at Griffith University, boardmember of Transparency International, and currently leads Australia’s second national integrity system assessment.  He was a member of the Government’s expert advisory panel on whistleblowing.

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