IBAC rejects private hearing request: 'a deterrent to others'

By David Donaldson

March 11, 2016

Victoria’s anti-corruption commissioner has rejected a bid by the man at the centre of the inquiry into the Education Department to have his examination heard in private, arguing public hearings have an important deterrent effect.

Independent Broad-Based Anti-corruption Commission commissioner Stephen O’Bryan said on Thursday he had been asked to reconsider his decision that former Education Department deputy secretary Darrell Fraser would be examined in public. Fraser’s lawyer argued a public hearing may prejudice a possible future criminal trial and would damage Fraser’s reputation.

Witnesses have told the inquiry Fraser swayed the tendering process for the failed Ultranet software system — which was originally budgeted to cost $60 million, but blew out to as much as $240 million and was eventually scrapped — favouring a consortium of CSG and Oracle. He later took a job with CSG. The inquiry also heard of an environment of fear during his time at the department.

O’Bryan decided the examination would proceed as planned on Wednesday, however. He rejected the “assertion of inevitability” that a criminal case would take place, noting police had not even commenced an investigation yet.

He referenced a similar decision made earlier the same day, when the High Court refused an application for a private IBAC examination for two Ballarat police officers accused of using excessive force on a mentally ill woman. Regarding the argument that a public anti-corruption inquiry hearing would prejudice a criminal trial, O’Bryan quoted a court ruling arguing:

“… any theoretical jury trial would likely be some considerable time in the future and it is well recognised … that putative jurors’ memories fade of events over time as they are replaced by other sensational news.”

O’Bryan added there was a strong public interest in such inquiries being public. The airing of evidence of possible corrupt behaviour has the benefit of:

“… encouraging other people to come forward with information relevant to other possible public sector corruption to help garner public acceptance and confidence in the investigation”

It also serves as “a deterrent to others particularly in the public sector”.

The commissioner noted the importance of “the integrity of the tender and procurement processes in the public sector due to the scarcity of available funds” and argued that such hearings helped to identify systemic weaknesses within government that facilitate corruption.

O’Bryan thought that if reputational damage to Fraser were to occur it “would not be unreasonable in all the circumstances”, emphasising that questions put to previous witnesses had been “based on documentary material” and thus “were at least credible”.

Rosewarne: we weren’t running the show

Former acting secretary Jeff Rosewarne appeared before IBAC on Thursday, rejected earlier witness suggestions he and Fraser “were virtually running the department”.

He conceded he had asked for his computer to be wiped when he finished working at the Department of Education and Early Childhood Development, but disagreed it was “not standard practice”, as former general manager of the department’s audit risk branch James Kelly had stated.

Rosewarne struggled to recall the answers to many questions. While he could remember discussing with probity adviser Anne Dalton her concerns about the way Fraser was behaving on the Ultranet board, Rosewarne stated he could not recall the details of the conversation.

Dalton told IBAC she raised with Rosewarne concerns that Fraser and another board member, PwC’s Chris Bennett, had “blatantly” acted against her advice during the tendering process to cease contact with the CSG/Oracle consortium that eventually won the contract.

The hearings continue next Tuesday with Ultranet panel member John Allman, who allegedly purchased $10,000 worth of CSG shares the day before the company’s contract with the department was announced. Fraser will appear on Wednesday.

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