INDEPENDENT COMMISSIONER AGAINST CORRUPTION BILL

Committee Stage

In committee.

(Continued from 29 May 2012.)

Clause 42.

Mrs REDMOND: I think we left yesterday at the point where I had asked a question on clause 42 of the bill and the Attorney had indicated that he wanted to give me a more profound answer on that than the time available would allow.

The CHAIR: I think it is a more in-depth and more detailed response.

Mrs REDMOND: Rather than profound? You don't accuse the Attorney-General of profundity?

The CHAIR: No, it could be both. Attorney, would you like to respond in your profound manner?

The Hon. J.R. RAU: Again, I would not claim profundity. This raises an important issue which I think was touched upon both by the Leader of the Opposition and by the member for Bragg, which is really the scope of the concept of a public authority. I just wanted to put a few things before the parliament about that topic, because I think it is important and it might help people understand what is going on. I think the leader, in her remarks yesterday, said that if, for example, we were to go to Hong Kong, there they draw the demarcation point between the jurisdiction of their anti-corruption bodies at a different place than we do, and I think the point that the leader was making was that, in Hong Kong, private sector outfits are included. There is always, therefore, a jurisdictional boundary for these types of organisations, and I guess as, again, the leader said yesterday, if you go for the Hong Kong model, you do not have a boundary problem because it does not have a boundary.

But I do not think anybody in Australia has gone down that track and nobody has suggested seriously that we should, and so that leaves us with this boundary question as to where exactly the dividing line might be drawn between the jurisdiction of this body to exercise powers and it not being able to exercise its powers. It is in that context that we have come to the position where we are talking about public authorities, and we are saying here that our boundary line is the Public Service and public authorities.

I guess what I am about to say is not so much for the benefit of the Leader of the Opposition because I am sure she is completely au fait with this, but the flurry of activity that has occurred over the last day or so has been largely the product of a public authority that does not want to be a public authority, and the member for Bragg made the point yesterday that she was wondering whether we had been a bit too careful in drawing the boundaries a bit close.

Let me say this, and place this on the record, there is a thing called the Local Government Act. The Local Government Act establishes a number of public authorities. Some of those, most of those, are things that we would recognise as local government in the sense of being a council, and nobody in this room seriously would debate that they should be excluded from the purview of the operation of this legislation. Indeed, anecdotally, and I emphasise only anecdotally, I think it has been made clear to me by members of the public that they have the view that the most likely place to find the sort of corruption we are trying to get to is, in fact, at that level, for a whole bunch of reasons.

The argument that has been stirred up by the LGA really comes down to this: under the Ombudsman Act 1972, there is a reference in terms of an administrative unit to an agency to which the act applies, and that in turn includes in the definition, the agency to which it applies in (d)(i) 'established for a public purpose by an Act'. If we then go to the Local Government Act, the current version says in Part 1—Local Government Association, '(2)(a)...continues to be a body corporate', and in subsection (3), 'The LGA is constituted as a public authority for the purpose of promoting and advancing the interests of local government...' etc., etc.

So let us make it pretty clear here, right now, that the LGA is now and has for many, many years been a creature of statute, exactly the same statute that created the local government entities to which we have no problem attaching the scrutiny of anticorruption bodies. Not only was it created by statute and discharge a statutory function but it has the capacity—if it acts inappropriately—to potentially put an impost on either rate payers or the state Treasury through the various entities through which it operates. This has been the case since 1975, when the former association, incorporated under the Associations Incorporations Act, was dissolved by the Local Government Amendment Act 1975.

The point of all that is to make it very clear that in my view the LGA is, and has been since 1975, a public authority and therefore has been, and should have been, subject to the scrutiny appropriate to a public authority. Yesterday, I understand with the authority of at least the President of the LGA, if not broader support, the executive director of the LGA put out a piece of paper which the Leader of the Opposition drew—

Mrs Redmond interjecting:

The Hon. J.R. RAU: No, indeed; but certainly it was sent to the Leader of the Opposition, to Mr Goldsworthy, to Mr Brock, to Dr Such, to Mr Pegler, to the Premier, to me and to minister Wortley. This piece of paper calls upon those people to whom it is addressed to delay the passage of this legislation through this house. I would like that on the record.

There is one organisation in South Australia, just one, that does not want this legislation to pass speedily and effectively through the parliament. We know the parliamentary timetable, we know that if it does not get through here it will not, in any reasonable time, get to the other place and be dealt with. If there is one organisation that stands out there like a sore thumb, it is the LGA. Why, I wonder?

According to the piece of paper, the bill has been introduced without consultation with the LGA. Wrong: it has been the subject of consultation with the LGA for well over a year, and the provisions in the original draft discussion paper, inasmuch as they refer to local government, are substantially the same as the ones in the current bill. The wording is interesting though. It says:

The bill has been introduced without consultation with the LGA and our usual process of consultation with councils is well under way and due to be completed shortly after 7 June.

I have personally consulted with the LGA about this bill on a number of occasions. I do not know what I was doing, apparently, on those numerous occasions—was I reading the racing form or doing a crossword? No, I was not—

Mrs Redmond interjecting:

The Hon. J.R. RAU: I was actually consulting, I was actually talking to them and discussing issues—but apparently that did not occur, according to the LGA. I can also tell the house that my parliamentary colleague, the Hon .Russell Wortley in another place, has had a discussion paper out and has been in vigorous discussion with them about a particular detail of this legislation, namely, the codes of conduct that would apply to elected members of councils and to the staff of councils. That is being moved on apace, and I assume that might be what is going to be completed on 7 June.

In any event, 'The bill has significant implications for the local government sector.' Yes, of course, and we have been talking about that for 18 months. They then refer to a document that was signed after the events occurred, so I am not sure what the significance of that is. Then we get to the crux of it. The document states that I:

...provided the LGA with provisions related to changes to Part 12 of the Local Government Act prior to its introduction—

There was consultation—

...[but did not] flag the proposed amendments impacting on the LGA itself.

Let us deconstruct that and get down to what it means. What it means is that councils are okay about this. They know what is going on; they have known what is going on for 18 months. What this piece of paper calls upon members of this house to do is to delay the passage of this bill because the LGA itself, in its own capacity, has reservations about the legislation. That is what it is about.

It is nothing to do with councils: it is to do with the LGA. Why do they have reservations? Because they do not like the idea that the Ombudsman might actually have a look at them if the Ombudsman decided that there was sufficient cause to do so. That is what they do not like. What makes them so special? Why is it okay for them to have these massive funds under their control (indemnity funds and I could go through all the things they are involved in) and each one of their constituent members can have the Ombudsman march in there at any time (and they are quite happy about that, by the way; none of them are complaining about it) but not them, in the context of them having been, in my opinion anyway, legally in that position since 1975?

What they are complaining about is a reference to them in this legislation that makes it clear beyond doubt that they are a public authority just like everybody else. They want the state of South Australia, this parliament, to hold up the passage of this legislation—which we are trying to get through in a swift but appropriate way—so that they can stir up trouble with the councils, so that all the councils feel sorry for them and they can come out and complain about this.

As far as I am concerned, the LGA can comment on this in their own good time. They have been at the table several times in discussions about this with local government. It may well be, and probably is, that this particular point was not the subject of discussion but everything else was. I just want to make it clear that, as far as I am concerned, if they have an issue about being subjected to scrutiny as a public authority, let them stand up and say what they mean.

Do not hide under the petticoats of all the councils. Do not throw rocks from underneath there at everybody else. Come out and actually say who you are, what you are and what you have got a problem with. I can tell you who they are—they are the LGA; what they are—for reasons obscure to me, they are worried about being scrutinised by the Ombudsman; and at the same time, they are a public authority.

We are either fair dinkum about this or we are not. If we are going to do this, we have to do it properly, and it might be inconvenient for them for some reason that is obscure to me, but I get back to my earlier point: in the public mind, rightly or wrongly, the perception is that the most likely place you will find corrupt behaviour is in local government or at that level. The only people we have standing up protesting about this are the LGA, not even the councils.

I absolutely defend the notion that public authorities should be drawn in terms of the definitions that I have just gone through and that, if you have people who are established by statute, particularly when they either have access to public funds or have the capacity to draw down through guarantees on public funds, it is not unreasonable that the Ombudsman in particular—but, if necessary, the ICAC commissioner—should have the capacity to examine what they are doing, because if they start going off the rails, the guarantees that the state government and the state Treasury have wrapped up in their activities will impact on all of us.

I am very concerned and I appreciate the discussion that I have had with the Leader of the Opposition. I am not saying any of this directed at the Leader of the Opposition because she had no notice of this any more than I did yesterday. She has not indicated any wish to hold up the bill and I appreciate that and I thank her for that. But the idea that this utterly self-serving and, frankly, perplexing concern on the part of the LGA should be advanced, wrapped up in some elaborate costume which has got 68 councils dangling off it, when it has got nothing to do with them, just so as to slow this bill down, I find extraordinary, absolutely extraordinary. Anyway, I think that is my comment on clause 42.

Mrs REDMOND: Mr Chairman, I did actually ask a specific question on clause 42 that I do not think the Attorney got to.

The CHAIR: Would you like to refresh his memory?

Mrs REDMOND: The question was actually about what happens if a commissioner or a deputy commissioner or an examiner or an investigator imposes some requirements on a public officer, of whatever nature, and that person thinks, 'I am not sure about whether I should do this,' and wants to get legal advice. What is the consequence?

Do they have to bear their own costs as a public officer in seeking legal advice as to whether or not they have to comply or do they just have to say, 'It is being directed by a commissioner or a deputy commissioner or other person from the ICAC and therefore I just have to comply with whatever has been directed without taking legal advice,' or meet the cost themselves?

The Hon. J.R. RAU: I thank the leader for that question. I think the answer lies in this respect: it would depend upon whether they were entitled to an indemnity under the usual rules applying to public servants or public officers. That would depend, I think, on the nature of the inquiry and the complaint.

I think the leader might notice that we did turn our minds to this a bit because it does create some potential issues in terms of the secrecy provisions. Elsewhere in the legislation, we provided that, if it is necessary—

Mrs Redmond interjecting:

The Hon. J.R. RAU: Pardon?

Mrs Redmond: This provision about if you are bound by secrecy provisions.

The Hon. J.R. RAU: You can still seek legal advice and that contemplated also seeking indemnity. So, we did contemplate that. We did not want a person to be in a horrible position where they want to seek legal advice, but they go to the law and they cannot tell them anything because they are under a secrecy situation. So, we have contemplated that.

It has been pointed out, quite rightly too, that subsection (1) says that a public authority must assist public officers. Again, I think that goes back to the indemnity point, but it was contemplated that these people, in many cases, would be entitled to an indemnity because they would be acting, in effect, in the course of their public office and they would not necessarily be there as a potential target of an investigation. They might simply be cooperating and they might need to know what their rights and responsibilities were in the context of that, which is why we have that there and why we also have that other provision about the obtaining of legal assistance or indemnity.

Mrs REDMOND: Lastly, on this clause, could I then ask the Attorney to put it on the record that his interpretation of that provision in subsection (1) of clause 42 about the assisting with compliance would be interpreted broadly enough to allow an officer, of whatever organisation, to have some sort of preliminary legal advice as to their obligation to comply or not, so that compliance, in its normal sense, would be simply doing whatever has been asked. What I am asking you to put on the record is that it is within your contemplation that that would be interpreted in reality as being broad enough to at least get some preliminary indication as to what their obligation is and whether or not they have to comply.

The Hon. J.R. RAU: I think I have to say that I cannot give that assurance in a blanket form. What I can say is that I perhaps could answer it by way of an analogy. When you have police officers who are called before a coronial inquiry, if it turns out that the police officer has been broadly acting within the scope of their duty, then they are entitled to receive and do receive an indemnity for their legal representation costs.

If it turns out that that person has been right off the scale and been misbehaving, and maybe even guilty of a criminal offence, then they are on their own. My understanding of this provision would be it would operate in a similar fashion.

Clause passed.

Clause 43.

Mr HAMILTON-SMITH: This might be the appropriate point, by agreement of both sides, that I be given a bit of latitude to address the issue more broadly, having by agreement forgone my right to make a contribution at the second reading stage. So, I will adopt that approach.

The CHAIR: You have 10 minutes.

Mr HAMILTON-SMITH: I want to indicate my full support for the bill. I will have some questions, but I have a particular interest in the measure because I was leader of the opposition at the time this first launched into public profile, and it was a treasured goal of mine as opposition leader at the time to reach this day. I fulsomely acknowledge the support of the Liberal Party room at the time of the view that we needed an ICAC.

I remind the house—and I know this has been done by earlier speakers—that it was on 23 August 2007 that the state Liberals called for this ICAC to be formed. I announced that preferred model, stating that it would be based on New South Wales, and on 5 April we released a preferred draft model for an anticorruption body for consultation with stakeholders in more detail. A bill was then introduced by the leader, the member for Heysen and shadow attorney-general at the time, on 27 November 2008 as a result of that consultation.

I remind the house of the way in which it was received. I commend The Advertiser in particular for its editorial support for the measure because it front-paged the announcement on the 23^rd, with this announcement:

An independent commission to tackle corruption at all levels in South Australia is planned by the Liberal Party in a major policy shift.

It went on:

The bill, aimed at giving SA its first independent anti-corruption body, will be introduced to the parliament in the new year. This will also be a central plank of the Liberal's election policy in 2010.

And it was. They quoted me as saying that 'we would introduce the corruption policy today, making the Liberals the first major state political party to propose the idea'.

I make that point because I do not think we would be here today if the state Liberals had not taken the stand they did. We went on and talked about the various models that were in existence around the country at the time, and I note that the following day the then leader of the Labor Party came out and criticised the idea, describing it as a carnival of lawyers in an article in The Advertiser on page 8 in the all-round country edition.

I have noted, too, the contributions made about the measure by the Hon. Bernard Finnigan in the upper house on 15 October 2008 and by the attorney himself on 18 October 2008, when words were guarded, shall we say, because I think deep down the attorney and a lot on that side realised that this was an idea whose time had come, but they were coming up against the brick wall of their then premier and then attorney in terms of making it a reality.

What we have before us today is a model that is some distance from what was originally proposed by the state Liberals but one that is still welcome. I acknowledge and give full credit to the Leader of the Opposition who then, as shadow attorney, put a lot of work into this measure. I also acknowledge the efforts of the Hon. Rob Lawson, who was then assisting her in the upper house, and of the whole of the Legal Affairs Portfolio Committee, which I know put in enormous effort on this.

I can tell the minister that, when I first took this to the Liberal Party room it did hit some resistance, and we need to freely acknowledge that, and a lot of the criticisms the government made at the time were debated in our party room, that is true. There were discussions about what might be the impact of this, whether it would be abused, whether it would be used as some sort of star chamber and innocent people would have their reputations hatcheted unfairly, etc. But, to the great credit of the Liberal Party room at the time, back in 2007 we resolved that we would go forward with a model, irrespective of those concerns and one that dealt with those concerns, and we would stick with the policy. That was in the face of considerable opposition from the government but, of course, you were opposing us at the time on our plans for the hospital, our plans for a city stadium, our plans for reinvigorating the city. It seemed that everything that we came up with was a squint, not a vision, yet you have now gone on to adopt most of those polices, and this is one of them.

I am just making the point that this is an example of a case where an opposition can lead from opposition and can get results for the people of South Australia. Were it not for the state Liberals I do not think we would be here today debating this measure. It is a credit to everyone on the Liberal team that we got to this point and I am very pleased that we are debating it. That is not to say that this is not going to have some difficulties and some teething problems. I know the Attorney has recognised what they might be.

There are concerns about public hearings and concerns that people's reputations may still be trashed with what are essentially unsubstantiated accusations—and we are seeing a bit of that in politics at the moment around the country and it is a real concern. There are also real concerns that I have about the issue of costs. I think my honourable friend the leader raised this a moment ago. I am thinking of the case of Dr John Knight who was accused of all sorts of things by one or two in the medical profession and by the Minister for Health in the parliament and who was arraigned before the Coroner's Court, having to defend his reputation about accusations that he made some mistakes during an operation, and incurring costs with QCs and lawyers that I understand have run into the hundreds of thousands of dollars.

This was essentially not a criminal hearing but a Coroner's Court hearing, but it was pivotal to what might subsequently follow in terms of any criminal litigation or civil litigation and critical to the future of his business and his professional reputation. So you are drawn into situations where you must defend yourself and you must engage solicitors and QCs to assist you with the hearing—and now it will be so with the ICAC model set up by this bill—even though you are not necessarily guilty of anything but you are simply protecting your reputation.

I am particularly concerned in that regard for the reputation of members of parliament and their legal standing, because if it is a civil servant who is arraigned before the ICAC they will be arguably covered by the Crown; if it is a minister I am sure they will be covered by the Crown. What happens to a member of parliament who is not a minister or a member of executive, whether they are a government backbencher or whether they are an opposition frontbencher, are they going to be left out on their own to meet their own legal costs during some sort of a hearing, whether it is open and closed? Can the minister guarantee that that will be dealt with by the measure?

I do not intend to go on; I will leave it with that question. However, I did want to make my earlier points regarding this being a significant example of an opposition taking the lead on an issue and ultimately bringing the government to the house with a solution under the weight of public opinion. I think it is a credit to all, but particularly to The Advertiser, frankly, and others in the media who were very supportive of that campaign. I will ask the minister to answer my question regarding the costs issue.

The Hon. J.R. RAU: I thank the member for Waite for his contribution and I do acknowledge his longstanding commitment, along with the Leader of the Opposition's longstanding public commitment to this type of outcome. Whilst, no doubt, any piece of new legislation will involve some teething issues—and this will unless we have it absolutely perfect—

Mrs Redmond: The first time ever.

The Hon. J.R. RAU: The first time ever, but that is why we have the annual reporting arrangements so that the commissioner can get back to everybody and invite the parliament to make changes. On the particular point about costs the honourable member raises, I think it is a good point and I will be happy to have discussions with the honourable member about that in more detail between here and the other place.

There is no overall provision of costs here. I was answering the leader's questions more directly in respect of public officials but I do acknowledge that ordinary members of parliament stand outside of that assembly of people. I am more than happy to have a discussion with the honourable member about what might be done to accommodate that.

Progress reported; committee to sit again.

[Sitting suspended from 13:00 to 14:00]