Federal ICAC case strong, despite anti-bribery measures

By Stephen Easton

Monday April 27, 2015

Last week saw a flurry of new reports of public servants caught doing the wrong thing.

On Thursday the country’s newest independent corruption fighter, South Australia’s independent commissioner against corruption Bruce Lander, announced six charges against the former manager of the state’s Interpreting and Translating Centre, who is alleged to have profited from inside information. Lander also revealed a woman faces an abuse of public office charge as well as 233 counts of theft and 114 counts of dishonest dealing with documents, after a separate investigation.

Meanwhile in Sydney, a former Department of Agriculture employee was charged with two corruption offences in relation to a consultancy he established, only a few hours after a very remorseful Canberra public servant was sentenced by a local magistrate for using his employer’s credit card improperly.

It continued on Friday, although the theme changed to public officials indulging in criminality on their own time. A senior executive from the Australian Government Solicitor’s office pled guilty to drug dealing charges and a Defence employee was sentenced for possessing child pornography, while the ACT Supreme Court dealt with a senior manager from Airservices Australia who used fake businesses to defraud $380,000 from the tax office.

Just today, Victoria’s Independent Broad-based Anti-corruption Commission (IBAC) claimed its first major scalp, that of the allegedly corrupt former education department official Nino Napoli, on the first day of a series of hearings expected to run for the next six weeks or so.

“It is a proactive recognition that the current arrangements are in many ways insufficient … but it’s not a replacement for an ICAC.”

Wrongdoing happens everywhere, but when it happens in government often, at a high level or when the normal procedure in some part of the public sector is seen to be crooked, public confidence in the whole institutional framework takes a hit. It’s much easier to trust an independent statutory body, empowered to unearth corruption through investigation and interrogation than an agency of the government — with good reason — which is why such entities are now one of the standard accountability mechanisms at state level.

Both major parties and plenty of federal mandarins oppose the establishment of such a corruption watchdog for the Commonwealth, but that hasn’t stopped cross-benchers and experts from outside government continuing to prosecute the case.

Gabrielle Appleby
Gabrielle Appleby

UNSW associate professor of law Dr Gabrielle Appleby supports the creation of a federal ICAC, but says it must be appropriately designed, adequately funded and sit within “a web of accountability mechanisms that can all check and balance each other”.

“It performs an important inquisitorial role, a role that OK, yes, sometimes royal commissions can also perform, but they’re so hard to get off the ground, particularly when it’s about investigating corruption within government,” Appleby told The Mandarin. “[Standing anti-corruption commissions are] an important part of that accountability framework but they’re not the only part, and they shouldn’t be an unmonitored part of the accountability framework.”

The week before last, a long list of tweaks and improvements to the Commonwealth’s anti-corruption mechanisms aimed at enhancing guidance, professional education and cross-agency collaboration were detailed in a report from the Organisation for Economic Co-operation and Development’s Working Group on Bribery.

The report also revealed the number of foreign bribery investigations undertaken by the Australian Federal Police increased from seven in October 2012 to 17 — possibly a consequence of one of the key enhancements it refers to, the establishment of the Fraud and Anti-Corruption Centre in 2013.

“I think you have to take [the establishment of the FAC Centre] as a positive move by the government,” says Appleby. “It is a proactive recognition that the current arrangements are in many ways insufficient … but whilst it seems to be part of a general strengthening of the system of checks and balances at the federal level, it’s not a replacement for an ICAC.”

The measures taken over the past several years represent Australia’s progress towards implementing 33 recommendations made by the OECD working group in October, 2012. Among them was the suggestion:

“…that the AFP take sufficient steps to ensure that foreign bribery allegations are not prematurely closed, and be more proactive in gathering information from diverse sources at the pre-investigative stage.”

A few months earlier, compelling allegations had surfaced in a joint ABC-Fairfax journalism investigation, made by the former acting co-ordinator of the AFP taskforce looking into how much public officials knew about the Australian Wheat Board illegally paying kickbacks to the Iraqi government. The claims, backed up by other members of the taskforce, suggested it encountered mysterious resistance from above and was shut down prematurely to avoid embarrassing the government.

That affair then became the subject of a senate inquiry, which reported in late March. Unsurprisingly, the Labor and Coalition members of the committee agreed on only one recommendation:

“… that this matter should not further exercise the resources of the federal parliament.”

The far longer and more detailed minority report by the committee’s chair, Greens senator Penny Wright, contained four recommendations including another call for a federal ICAC.

“One of the main purposes of these types of bodies is to promote public confidence in the integrity of government administration,” said Appleby. “The establishment, in and of itself, is one way of demonstrating that.”

Another role for a federal ICAC would be “to tell the public service and elected officials that the government is serious about corruption” in order to promote a stronger anti-corruption culture, she adds. “So, it is not necessarily just the high profile investigations that make a standing commission necessary, it’s also that educative role, in changing and shifting the culture.”

“You have to be careful about publicity of corruption investigations … can have these perverse consequences where you see resignations, and pre-emptive resignations over relatively minor matters.”

Two reports published in February and March by Western Australia’s Corruption and Crime Commission, which looked broadly at misconduct risk, demonstrated a role that goes beyond catching crooks in specific cases.

As well as financial and legislative independence from government, a federal ICAC would need sufficient powers to peer into the inner workings of government, but it must be designed carefully to make sure it is not too powerful, according to Appleby.

“I think that you have to be careful about publicity of corruption investigations,” she said. “I think that sometimes public investigations are a really important part of an ICAC’s functions, but sometimes, particularly in relation to less serious and systemic matters, the public investigations can have these perverse consequences where you see resignations, and pre-emptive resignations over relatively minor matters. And that, I think, is again a matter of institutional design.”

Appleby points out that just because it was first, the powerful, public and very aggressive NSW ICAC is not necessarily the best model. Bruce Lander’s office in SA, for example, does not do its work in the public eye. Another unique aspect is that it was not set up in the wake of a major scandal, as was the case in other states.

“The former Labor premier Mike Rann had always been opposed to the introduction of a commission against corruption. He had always indicated that he didn’t think corruption was a problem in South Australia and that the mechanisms that were in place were sufficient — so very similar arguments to that you see at the Commonwealth level — but then with a change in leader, you’ve got a change in approach.

“I think now that we’ve got anti-corruption commissions in all of the states … it will become increasingly strange that there’s no standing anti-corruption commission at the Commonwealth level. So just through generational change, maybe we will see that eventually.”

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