Why conflicts of interest cannot be ignored: IBAC probes alleged corruption in the City of Casey

By Stephen Easton

October 25, 2019

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The City of Casey council in south-eastern Melbourne is the latest to face allegations of serious corruption that will be aired in a public inquiry.

The Independent Broad-based Anti-corruption Commission will publicly examine the council’s allegedly dirty laundry in a series of hearings starting on November 18. Like many others before it, the inquiry will focus on council decisions related to property development, planning and procurement.

One big question is whether those decisions have been unduly influenced by donations, gifts, pro bono services, or hospitality given to the people making them — bribes, if you will. The hearings, part of an investigation called Operation Sandon, will also examine whether such undue influence results from the work of professional lobbyists or planning consultants.

Robert Redlich, the head of IBAC, will run the proceedings with barrister Michael A Tovey as counsel assisting, and IBAC’s principal lawyer Amber Harris.

“These public hearings will examine the transparency and integrity of planning and property development decisions, and whether lobbyists or planning consultants have had undue influence over state and local government planning and property development decisions,” said Redlich.

“More broadly, they will consider whether current systems and controls in place are sufficient to ensure the integrity of the planning process, and if serious corrupt conduct is identified, how organisational culture and practices may have fostered that conduct or prevented it from being detected and stopped.”

Corruption usually starts with conflicts of interest

Decisions around procurement and property development are major areas of corruption risk, for obvious reasons. Given the essence of corruption is private interests being put above the public interest, one of the best ways for public sector leaders to manage that risk is to keep a weather eye out for potential, perceived or actual conflicts of interest.

“Conflicts of interest are an inevitable part of life, and they clearly exist for most people working in the public sector,” said Redlich, launching IBAC’s latest advice on how to manage them and a fact sheet on related myths and misconceptions. It is when conflicting interests are “concealed or mismanaged” that problems arise, he observed.

In the Victorian public sector, Redlich finds procurement, recruitment and information management are major areas where conflicts of interest arise, along with regulation, governance, custodial management, information and internal investigations.

The new IBAC report contains typical stories of senior public servants awarding contracts to companies controlled by themselves or their associates, enjoying luxurious boozy meals with suppliers, nepotism in recruitment, and improper relationships between staff of regulatory bodies and the companies they are looking at.

Others involve perceived conflicts of interest, undeclared associations, compromised internal investigation processes and unauthorised disclosures, like one case of a public servant feeding information to bikies.

Some are positive examples of best practice like the Department of Education and Training’s new central register for reporting conflicts of interest, and a similar project by the City of Ballarat council, which is also updating its procedures for reporting gifts, benefits and hospitality.

“Often, the best way for public sector employees to avoid a conflict of interest is to never accept a gift, benefit or hospitality,” said Redlich.

About 20% of state and local government employees and almost a third of Victoria Police staff have noticed conflicts of interest at work, according to IBAC’s research. The commissioner says the onus is on leaders to put robust policies and processes in place and make sure they are well known, understood and followed.

“This will build a workplace culture where employees feel comfortable discussing situations where a conflict of interest may exist so it can be effectively managed before it becomes an issue.”

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