Drain the billabong? The interest groups who hold the minister’s ear

By David Donaldson

Monday September 24, 2018

Two Business people working together on laptop meeting with technology

There are few things more frustrating for public servants than the minister ignoring a well-researched evidence base in favour of an interest group.

Lobbyists know they can win ministers over, too — analysis by think tank the Grattan Institute shows businesses with the most to gain from government decisions lobby harder and obtain more access to senior ministers.

“Who’s in the room — and who’s in the news — matters for policy outcomes,” says Grattan’s Institutional Reform Program Director Danielle Wood.

“Powerful groups have triumphed over the public interest in some recent debates, from pokies reform to pharmaceutical prices, to toll roads and superannuation governance.”

“Who’s in the room — and who’s in the news — matters for policy outcomes.”

Highly regulated industries such as property development, transport and mining — where ministerial decisions can make or break a company — spend the most on lobbyists, reveals Grattan’s new report, Who’s in the room? Access and influence in Australian politics.

Interested parties use several avenues to gain the ear of decision makers.

There’s the revolving door between government and lobbying: after leaving politics, more than a quarter of politicians go on to work for special interests, where their relationships can help open doors. It’s easy for senior public servants to do the same, too. The only real restriction on lobbying activity is the undertaking by ministers, ministerial advisers, and senior public servants not to lobby within 12-18 months of leaving office.

“This is important because of the privileged information they have access to, and the risk that a minister might make decisions in office with future career prospects in mind,” says Grattan.

“But the waiting period is only an administrative obligation. Many ignore it and there is no penalty for breach.”

Money and relationships can boost access: time with ministers and shadow ministers “is explicitly ‘for sale’ at fundraising dinners, and major donors are more likely to get a meeting with a senior minister”, Grattan argues.

And the major political parties rely on a handful of big donors: just 5% of donors contributed more than half of the big parties’ declared donations at the last election.

All this increases the likelihood elected representatives will take the side of special interest groups over the public interest. Indeed, Australians increasingly believe this is what happens: surveys show that since the early 2000s, perceptions that “people in government look after themselves” and that “government is run for a few big interests” have risen significantly.

In 2018, 85% of Australians surveyed thought at least “some” federal MPs were corrupt (on par with perceptions of state MPs and worse than for local councillors). Australia is the only highly-ranked country on Transparency International’s Corruption Perceptions Index to have experienced a significant decline in recent years.

Left unchecked, weakening citizen trust could undermine our whole system of government. In the shorter term it makes unpopular but necessary reform more difficult.

“Australians want to drain the billabong,” Wood says.

“They don’t like the current system and they don’t trust it.

“The changes we propose would improve the quality of policy debate and boost the public’s confidence that policy is being made for all Australians — not just those in the room.”

Recommendations for cleaner politics

The solution is not to shut interest groups out of politics altogether — they have a right to have their say as much as anyone else in a democracy — but to ensure they are not exercising undue influence.

The Grattan Institute proposes eight key reforms across three themes:

Improve transparency in policy-making:

  • Publish ministerial diaries to enable public scrutiny of who ministers are meeting — and not meeting — and encourage them to seek out a wider range of views.
  • Link the lobbyists register to ‘orange passes’ to identify commercial and in-house lobbyists with privileged behind-the-scenes access to Parliament House, and ensure they comply with the lobbying code of conduct.
  • Improve the visibility of political donations by lowering the donations disclosure threshold to $5000, requiring political parties to aggregate multiple donations from the same donor and requiring more timely release of donations data.

Strengthen accountability of policy-makers:

  • Clarify conflicts of interest for all parliamentarians — particularly around hospitality, gifts and secondary employment — and set a standard for the public, media and parliament to hold elected officials to.
  • Independently administer codes of conduct, to build public confidence that people are complying with them. Appoint a separate ethics adviser to encourage current and former politicians to seek advice when they are in doubt.
  • Establish a federal integrity or anti-corruption body to investigate potential misconduct or corruption, publish findings, and refer any corrupt activity to the Commonwealth Director of Public Prosecutions.

Level the playing field:

  • Cap political advertising expenditure by political parties and third parties during election campaigns to reduce the imbalance between groups with different means to broadcast political views, and limit the reliance of major political parties on individual donors.
  • Boost countervailing voices through more inclusive policy review processes and advocacy for under-represented groups to give politicians and public officials better information with which to adjudicate the public interest.

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