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Legislative Council - Fifty-Second Parliament, Second Session (52-2)
2012-06-12 Daily Xml
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INDEPENDENT COMMISSIONER AGAINST CORRUPTION BILL

Second Reading

Adjourned debate on second reading.

(Continued from 31 May 2012.)

The Hon. S.G. WADE (16:28): This bill is a historic bill. It is the ninth ICAC bill to come before the Legislative Council. Democrat MLC Ian Gilfillan first moved a bill to introduce an ICAC in October 1988. The Democrats tried again in 1990, 1998, 2005 and 2007. In 2008, the Leader of the Opposition, Isobel Redmond, the then shadow attorney-general, moved a bill for an ICAC in the House of Assembly. At a press conference at the time, she indicated that she would be well satisfied with her parliamentary career if she could see into this state the introduction of an independent commission against corruption. This shows the commitment of our leader to service.

In 2009, the Hon. Robert Brokenshire introduced another ICAC bill into this place. On 12 May 2010, I introduced an independent commission against corruption bill, the eighth attempt by members of this council to introduce an ICAC into South Australia, and that bill embodied 24 years of collective wisdom. One ICAC bill did pass this council and was sent to the other place on 14 October 2009.

This bill is not new but it is unique. It is unique in two respects. Firstly, it is the first ICAC bill to be received by this council from the House of Assembly. Secondly, it is the first ICAC bill to be sponsored by the Labor Party. The fact is that there is only one party that has opposed every single one of the eight previous ICAC bills, and that party is the Australian Labor Party. As part of that campaign over 24 years, then attorney-general Atkinson said:

ICACs are a gift to malicious slanderers who want nothing more than a headline or a TV promo. They are also a gift to those who want to exert inappropriate pressure on public officials. These people say, 'Give me what my client wants or I'll call in ICAC,' or, 'Your decision will be ICACable.'

That is just one of a galaxy of comments by former attorney-general Atkinson and former premier Rann against an ICAC. The now Attorney-General (John Rau) also joined in that chorus on 19 June 2008. In a speech in the House of Assembly he mocked calls by the member for Heysen for an independent commission against corruption as 'me-tooism'. He said:

'People in New South Wales have got one. I want one. People in Victoria have got one and people in Western Australia have got one. I want one too. Why can't I have one? They've got one.' No question about whether it is useful, whether it achieves anything or whether it is a despotic outfit completely out of control, doing more harm than good: 'They've got one, I want one.' I think psychologists talk about some sort of envy in children. I think this is an ICAC envy, instead of something that young girls are supposed to experience.

The situation is pretty clear. If you are trying to justify the establishment of what amounts to a broad ranging standing royal commission or some sort of a star chamber inquisitorial outfit, you have to make out your case.

I pause to stress those words. This is the minister who is now sponsoring this legislation describing ICACs as broad ranging standing royal commissions or some sort of star chamber or inquisitorial outfit. The quote continues:

One of the problems with these commissions is that all around the world where they have been established there is a tendency for them to try to justify themselves by producing more and more sensational results because they are a results-driven thing. So, you go out and try to make a big splash just before budget time so you can then lever a bit more money out of the government of the day, or you try to make some other big splash in the media so people think you are doing something. Will a media-driven standing indefinite royal commission benefit the people of South Australia more than it causes trouble for itself and all the people who might come under its gaze?

The Attorney-General continued in that speech and mocked the member for Heysen, implying that she was prone to conspiracies. From August 2009 the then premier Mike Rann started to call for the introduction of a national anti-corruption commissioner. The Liberal Party went to the 2010 election with a state-based ICAC as the central plank of a range of measures to promote transparency. Other parties such as Family First and the Greens had declared positions in support of a state-based ICAC.

In fact, at the election more than 60 per cent of voters for this council voted for parties supporting the ICAC. After the election the new Attorney-General John Rau had a prime opportunity to take his party on a new path, but he chose not to. On the first day of the new parliament and his first day as Attorney-General in the parliament he chose to give a ministerial statement reiterating the government's opposition to an ICAC. The new Attorney-General's top priority was not to have an ICAC. He said:

Demands for the establishment of a state so-called ICAC have been noisy but unsupported by a substratum of fact or logic. No evidence has been presented to show that systemic failures by existing state-based agencies are allowing corruption to flourish in South Australia.

Allegations, no matter how sensational, are not evidence. In the absence of evidence, logic does not suggest the need for an ICAC.

Clearly, the Attorney-General was expecting to be able to prosecute the case against an ICAC. He brashly expected that he could turn the tide of public opinion when he was delivering the message rather than his predecessor, attorney-general Atkinson. But the tide did not turn, and the story of the last 18 months has been a slow and limited withdrawal by the ALP to what is now an ICAC light.

The persisting arrogance of the government was on display in the Attorney-General's second reading speech to this bill. At length he recited the history of the bill. He completely ignored the two decades of Legislative Council activity; he completely ignored the leadership of Isobel Redmond in putting an ICAC on the agenda; and he completely ignored the role of the Liberal Party at the last election in making an ICAC inevitable.

The contrast in leadership quality is stark. The Leader of the Opposition is significantly valuing her career by her ability to deliver a key reform, a reform that she has delivered, with the support of other stakeholders. The Attorney-General, on the other hand, cannot bring himself to admit that he and his party were wrong. I fully expected Isobel Redmond would not need to be content with an ICAC as her career's high point. I look forward to many more reforms under her leadership. Unlike the chameleon performance of the Attorney-General of the Labor Party, the leader is a conviction politician, who will make a great premier.

Of course, the debate was not limited to this parliament or to the political parties. I and my party would want to pay tribute to the advocacy of a wide range of stakeholders in the South Australian community, who have been arguing long and hard for an independent commission against corruption. In August 2000, former auditor-general Mr Ken MacPherson delivered a speech outlining the many reasons why an ICAC is needed in South Australia. In that speech, he said:

Whilst the powers of the Auditor-General may be extensive, the matter of corruption does require that there be power to conduct covert operations. That's the only way that people like Brian Burke and co were flushed to the surface. And this is not a traditional role of the Auditor-General in the Westminster system.

Former director of public prosecutions, Mr Stephen Pallaras, is quoted as saying:

An anti-corruption authority with full law enforcement powers over both the public and private sector is the best tool yet to educate the community on issues relating to corruption.

Mr Pallaras called for an ICAC in his annual report to parliament on 14 October 2009. The former Law Society president, Mr Richard Mellows, on behalf of his society, said:

In the Society's view, the current mechanisms in place in this State are limited in what they can investigate. An independent, broad-based anti-corruption commission is the answer. Such a Commission is better placed to deal with corruption issues from the hotchpotch of State watchdogs which we currently have.

Senator Nick Xenophon, a senator from South Australia and a former member of this council, in the lead-up to the 2010 election, said:

If you're against corruption you should be for a local ICAC and for the Premier to be calling for a national body is really a nonsense, it's a stall story.

The calls came from the Labor side of politics, too. In 2007, then Labor premier of New South Wales, Morris Iemma, said of anti-corruption agencies, as follows:

Any jurisdiction that thinks they don't need one is delusional. Any jurisdiction that thinks they don't need one of these is crazy.

The South Australian Labor Party took direct pressure from its national leadership. I quote from an article headed 'Rudd pushes on anti-corruption body,' published in The Australian on 31 July 2009. It states:

Kevin Rudd has ramped up pressure on the Rann government to take a stand on regulating political donations and the role of lobbyists and to acknowledge the benefits of an independent anti-corruption body. Following Tasmania's announcement last week that it would set up an independent anti-corruption commission, South Australia and Victoria are the only states without such a body...The Prime Minister said in South Australia this week there were problems with corruption in public administration around the country and independent anti-corruption bodies played an important role in public life.

On 3 June 2010, after the state election and less than a month after the Attorney-General's ministerial statement saying arguments for an ICAC lack a substratum of logic, one of his Labor colleagues across the border, the then Victorian premier John Brumby, announced that his government would establish an anti-corruption commission. This left South Australia as the only state in Australia that was not committed to establishing an ICAC. No-one should be fooled that this government intends that this is to be a full-blooded ICAC. This bill proposes an ICAC lite. I will address some of the structural elements later, but one needs only to look at the budget to know that this government is not intending a full-blooded ICAC.

At the 2010 election the Liberal Party estimated the cost of an ICAC at $15 million. The government claimed that it would cost between $30 million and $40 million. Now we are told that this ICAC will cost a mere $6 million—one-fifth of their lowest estimate. The government was either lying then or they intend to establish a shadow of an ICAC. The following is a quote from one of the ALP's constituent unions, the Australian Manufacturing Workers Union, which provided a submission to the Integrity Review on 4 March 2011. It stated:

Whilst the proposed role and functions and powers are welcomed, the Commissioner's ability to deliver on them is contingent on being properly resourced to do so.

Perhaps they too understand this government's reluctance in introducing an ICAC and foresaw the deprived level of funding that will be allocated to it. The fact that the scepticism of the government about the need for an ICAC persists is evident from the convoluted logic of the Attorney-General in his second reading speech to this bill. He said:

Unlike some states, South Australia has fortunately thus far not been in a circumstance where cases of corruption, be it systemic or otherwise, have required an anti-corruption body to be established so as to attempt to restore faith and confidence in public institutions. Given this, some may question why an integrity body such as the ICAC is required in South Australia. My answer to that is that with modern society becoming increasingly complex, and the financial resources of public funds being stretched to meet the ever increasing needs for essential government services, the temptation to engage in corrupt conduct for personal gain by abuse of public office will exist. A modern and sophisticated society should pre-empt this risk and proactively act to safeguard and preserve community confidence in the integrity of public administration. Establishing an ICAC constitutes that pre-emptive strike and safeguard.

In my view that quote shows that the government remains sceptical. They see the ICAC light as an inoculation against some future risk. In spite the recurring cases of corruption within South Australia, in spite of their own conviction that South Australia is part of a national community struggling against corruption, the Labor Party persists with its scepticism. If elected in 2014 a Liberal Government will review the operation of the ICAC to ensure that South Australians get what they demand, which is a full-blooded ICAC.

The Australian of 23 February 2010, a mere three days into the campaign proper, highlighted what I believe is one of the key issues that have been exposed by this debate over an ICAC. The article was headed 'Redmond pushes Rann on trust, corruption'. It stated in the article:

The staking of firm campaign positions by the major parties on this issue insured the issue of trust continued to dominate the election campaign. 'I think the public will make up their mind about whether they trust Mike Rann on this issue any more than they trust him on other issues', Ms Redmond said yesterday.

The Labor Party has suffered in terms of people's willingness to trust it. In February 2010 only 34 per cent of people surveyed by The Advertiser said that they trusted Premier Rann, compared with 51 per cent who said they trusted Opposition Leader Isobel Redmond. Another poll found that 21 per cent of people polled thought that Premier Rann told the truth.

One of the key factors at play at that time was the fact that people are not prepared to trust politicians who simply demand that people trust them. Trust is more likely to be engendered where politicians are willing to be accountable and open themselves up to scrutiny. The Liberal Party knows the truth of the old adage that power corrupts and absolute power corrupts absolutely. We know that our party and members of our party will become the focus of an ICAC from time to time, but we also know that future Liberal governments will be better governments, more effective governments, for the presence of an ICAC.

The government is now rushing the legislation through this parliament to meet its own deadline. The government has repeatedly said that it is keen to get the legislation through as quickly as possible, but the government has no-one to blame but itself. It left itself a total of two months to consult, pass the legislation through parliament, conduct an international search for a commissioner and establish the office.

Earlier this year, a number of stakeholders went public on the fact that the government was well behind schedule in implementing the ICAC. I can remember the comments of the president of the Law Society as reported in The Advertiser on Easter Monday. It was plain to see that there was no way the ICAC would be up and running by 1 July, when the legislation establishing it had not even been finalised just a few months before it was to start. In addition, for the ICAC to utilise its proposed telephone interception powers, the federal parliament must first agree to it. That alone could take months. One can only deduce that the delay is either a result of the government's reluctance to introduce an ICAC or poor management on its part.

The ICAC is significantly about culture, and this ICAC is not being born in a culture of transparency. The government has broken its promise to make the submissions to the public consultation public. The opposition has been forced to resort to freedom of information requests to obtain the submissions because less than half of the submissions received by the government have been released to the opposition by the Attorney-General.

Coincidentally, I received notification today that, in my request for the submissions under freedom of information, the deadline has been determined to be extended, so I do not have access to all of the submissions. One of the submissions I do have access to is the submission by the Gawler sub-branch of the ALP, which states:

The model should be based on the premise that full disclosure is the norm and the basis from which all types of government should operate.

In addition, the submission goes on to state that FOI requests, and the government generally, should be 'based on a culture of full disclosure'. That certainly has not happened here. Given that this government has tried to avoid scrutiny like the plague, I cannot say I am surprised, but I am disappointed, nonetheless. Like the Gawler sub-branch of the ALP, I do not think it is acceptable and I do not think the public accepts this closed shop culture.

Further, it represents a broken promise, in that Labor committed to making submissions publicly available on its website, but none have been published, as far as I am aware. The ICAC was launched amid commitments for transparency, yet Labor continues to (arrogantly) pursue a closed shop approach. I am also concerned that the government did not release a copy of the ICAC Bill for public consultation before tabling.

You could contrast that with the approach being taken to the cemeteries bill. The cemeteries bill was released as a bill for consultation and people were given six weeks to comment on it. In contrast, this bill was not made available to the public before it was put into the parliamentary process. The opposition bend over backwards to honour the normal parliamentary protocols in terms of timing. We were bemused by the government not taking one House of Assembly sitting week to even address the bill. Nonetheless, the Local Government Association has called for a delay in parliamentary consideration of the bill. I quote from its letter to members in the other place:

...until the LGA has had a chance to respond to the Minister regarding its contents. The Bill has been introduced without consultation with the LGA and our usual process of consultation with Councils is well underway and due to be completed shortly after 7 June...At no time prior to the introduction of the Bill did the Attorney-General flag the proposed amendments impacting on the LGA itself.

The lack of consultation on the bill shows contempt for local government. Rather than apologising for the position the local government sector has been put in, the Attorney-General engaged in a vigorous and personalised attack. The local government minister currently has a consultation afoot on the governance framework for local government. The fact that the Attorney-General ignored that consultation shows his disrespect for minister Wortley, too. Not only that, but his assertions in relation to the supposed consultation are somewhat remarkable. On 30 May 2012 in the other place the Attorney-General claimed that the bill:

...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.

It might be noteworthy by the Attorney that the government only announced its revised position on ICAC in October 2011, just over eight months ago. Perhaps I could take a moment to remind the Attorney of a press release entitled 'New accountability measures for local government' which he put out on 30 October 2011. It opens:

The State Government's new anti-corruption measures will provide higher levels of accountability for local government, including giving the Ombudsman the power to investigate councils and sanctions for breaches of a mandatory code of conduct.

If the anti-corruption measures truly are new, as the Attorney-General's release says, how could he have been consulting with the Local Government Association for 18 months? A range of cases highlight the presence in South Australia of misconduct and corruption—the 'cartridgegate' affair, the 'foodgate' affair, manipulation of car defect records, issues in relation to councils. Misconduct and corruption are important concepts but they are not simple ones. While people want to do the right thing, they need to be supported to understand the ethical implications of their behaviours. That is why the Leader of the Opposition has always talked about the three arms of an ICAC.

First, there is the investigative role of an ICAC. An ICAC investigates the public sector to identify corrupt behaviour. But just as important are its other roles. ICAC's second role is in education. Proposed section 6(1)(e) states that a function of the ICAC is to conduct or facilitate the conduct of educational programs designed to prevent or minimise corruption, misconduct and maladministration in public administration. Very few public officers want to engage in misconduct or corruption but they need education to fully understand the implications of the choices they face. Of course, these issues are not clear cut.

Even with significant education, people will disagree as to the point at which conduct does become corrupt. The culture of the state is strengthened by educating the public, the parliament, local government and the broader public sector. ICAC's third role is prevention. Proposed section 6(1)(d) states that a function of the ICAC is to evaluate the practices, policies and procedures of inquiry agencies and public authorities with a view to advancing comprehensive and effective systems from preventing or minimising corruption, misconduct and maladministration in public administration.

The Liberal team is concerned about the failure of the government's bill to recognise the need to encompass the spectrum of conduct from sound conduct through to corruption. Corruption takes many forms from minor misuse of influence to institutionalised bribery. Within limited resources any corruption agency must have a focus but the government's bill only allows the ICAC to pursue criminal corruption.

The opposition is concerned that this standard is too high and too prescriptive, particularly if one takes seriously the preventive and educative roles of the ICAC. We propose amendments which would allow the ICAC to investigate misconduct or maladministration in certain circumstances. In his second reading speech, the Attorney-General said that this amendment puts the parliament in danger of a 'semantic argument'. He said:

Corruption is what you call it. What we have called it here is a criminal act, something known to the criminal law which is currently capable of being prosecuted.

The government's definition does not accord with the internationally recognised definitions of corruption. Transparency International's definition of corruption is 'the abuse of entrusted power for private gain'. This encompasses both financial gain and non-financial advantages. Of course, the government is free to define corruption how it wants but the community will make its own judgement. If the community is concerned about acts which it regards to be corruption and the ICAC is unable to deal with it because it does not meet the government's criminal threshold, the community will not tolerate a government which says, 'It's okay; we don't define that as corruption.'

The proposed office of public integrity is a novel element in the government's model. The office is novel, and we wait to see whether it is the best way to work. The government says it will be a one-stop shop assisting the public to know where they should direct their complaints and to make referrals to inquiry agencies and public authorities. The public will still be able to direct referrals directly to inquiry agencies.

I am concerned that the OPI may not have the necessary investigative capacity to properly assess complaints and reports. A recurring concern of the Liberal opposition is that laws both catch the guilty and protect the innocent. Given the range of conduct that could give rise to misconduct or corruption, it is important that complaints are handled in a way which minimises the impact on people who are not engaged in misconduct or corruption.

Under section 20(a) a person must not make a statement knowing that it is false or misleading in a material particular (whether by reason of the inclusion or omission of a particular) in information provided in a complaint or report. A more unusual provision is in section 20(b) which says that a person shall not make a complaint or report knowing that there are no grounds for the making of the complaint or report. Both actions attract a maximum penalty of $10,000 or imprisonment of two years.

Under section 21, the office of public integrity must assess a complaint or report. Under section 22(4), if a matter is assessed as trivial, vexatious or frivolous; if the matter is determined as having been previously been dealt with by an inquiry, agency or public authority and there is no reason to re-examine the matter; or if the office determines that there is other good reason why no action should be taken in respect of the matter, no action need be taken in respect of the matter. The opposition acknowledges that these provisions go some way to protect people from false accusations.

Under the bill, examinations relating to alleged corruption in public administration are to be conducted in private. The government asserts that private hearings protect reputations. However, on the other hand, private hearings can undermine public confidence in corruption investigations. Former Royal Commissioner Frank Costigan QC put it this way: 'Once you start investigating allegations of public corruption privately, then you add the smell of a cover-up.' At an anti-corruption conference held in Fremantle in November last year, the Hon. Wayne Martin, the Chief Justice of Western Australia, spoke about public accountability of anti-corruption agencies:

Public confidence is an essential component for the effective operation of any anti-corruption agency. Public confidence is enhanced by public accountability.

Having outlined the pros and cons of public hearings, Chief Justice Martin said:

The balancing of these competing considerations is a difficult task...The only opinion I would venture to those charged with making these difficult assessments is drawn from my experience in the courts and from my observation that public confidence in the integrity of the administration of justice critically depends upon the transparency of that process, and the fact that it is only in the most rare and exceptional circumstances that any part of that process will be conducted behind closed doors. That experience, and the significance which I attach to the educative and preventative functions, incline me to the view that hearings should be held in public unless there is a good reason to the contrary. In the context of the administration of justice, it has long been accepted that the risk of damage to reputation is the price which must be paid for transparency.

The opposition accepts that the government is proposing that hearings of the ICAC be private hearings. My leader has given an undertaking in the other place that, whilst we will not be seeking to amend the government's legislation in this respect, we will be maintaining a watching brief.

Another aspect of protecting people is ensuring that people who engage with the ICAC are aware of their rights and responsibilities and to that end have appropriate access to legal advice. I understand that members of parliament and local councillors will not have the same protection as to legal costs as other public officers such as cabinet ministers, public servants and police officers. This issue was raised in the other place, and the opposition welcomes and appreciates the Attorney-General's assurance that he will discuss these issues further.

The ICAC has strong powers, and the Liberal opposition supports that fact, but we also consider that strong powers necessitate strong oversight. The bill provides for a parliamentary oversight committee and, as a result of an agreement with the government during the passage of the serious and organised crime legislation, the committee will also oversee the implementation of organised crime laws. The Liberal opposition is concerned that the oversight committee is more than simply reviewing reports. We seek to expand the scope of the committee to ensure that it can provide effective oversight of the ICAC.

To support this broader role the opposition is concerned that the ICAC's capacity to provide information to the committee is not too narrow. The opposition has no intention of allowing information flows to the committee to undermine the necessary confidentiality of ICAC operations. We note the Attorney-General's concerns in this regard, and welcome the Attorney's undertaking to consult with the opposition on these provisions.

Concerns have also been raised in relation to the impact of the bill on parliamentary privilege. I welcome the Attorney-General's assurance in the other place that there is no intention for the bill 'in any way destroying parliamentary privilege or affecting it in any way'. On its face the bill does not allow for parliamentary privilege, and that is something we would want to discuss further with the Attorney and in the committee stage in this council.

In conclusion, I reiterate the comments I made at the beginning that the Liberal Party is delighted that at last this council is able to consider a bill, with the support of the government, to establish an Independent Commission against Corruption. It is not the model we proposed, but we are keen to support it so that South Australia can have on commission established and that that commission can evolve over time to fulfil the needs of the public sector and the community of South Australia.

At this stage I seek to ask three brief questions, which I hope the minister may be able to answer before we move into committee. First, will the privatised former operations of government be covered within the ambit of this bill? Secondly, in terms of the coverage of schedule 1, I seek a list of state public sector agencies or employees who are not covered by that schedule. Thirdly, and again in relation to schedule 1, I refer to the group of 'a person declared by regulation to be a public officer', and ask: what does the government envisage this clause will allow? In particular, does the government have any officers that it intends to specify by regulation in the short term?

Debate adjourned on motion of Hon. J.M. Gazzola.

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