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Legislative Council - Fifty-Fifth Parliament, First Session (55-1)
2023-05-17 Daily Xml
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Bills

Public Finance and Audit (Auditor-General Access to Cabinet Submissions) Amendment Bill

Second Reading

Adjourned debate on second reading.

(Continued from 16 November 2022.)

The Hon. K.J. MAHER (Minister for Aboriginal Affairs, Attorney-General, Minister for Industrial Relations and Public Sector) (17:21): I rise to make a brief contribution on the behalf of the government on this bill, which was introduced by the Hon. Heidi Girolamo on 16 November 2022. The purpose of this bill is to amend the Public Finance and Audit Act 1987, providing additional powers for the Auditor-General to access cabinet submissions and measures for the management of documents.

It is important to note on record that there is already a current policy within the formalised and public Premier and Cabinet Circular PC047, entitled Disclosure of Cabinet Documents to Investigative Agencies. This is a current active government policy available publicly for viewing on the Department of the Premier and Cabinet's webpage. The policy was approved by the former Marshall Liberal government on 18 February 2019 and remains active to ensure the South Australian government provides a level of access to cabinet documents to the Auditor-General.

Under this existing policy, the Auditor-General may request a cabinet submission required for the proper exercise of the Auditor-General's statutory functions. These requests are subject to the approval of the Premier in the case of a cabinet document of the current government or a government of the same political persuasion. If the cabinet document relates to the former government of a different political persuasion, the approval of the Chief Executive of the Department of the Premier and Cabinet, in consultation with the Leader of the Opposition, is sought.

This bill seeks to insert a new section 34A into the Public Finance and Audit Act 1987 to increase the power of the Auditor-General to obtain certain cabinet documents. The new section 34A would empower the Auditor-General to obtain cabinet documents by request. A notification will be sent prior to providing or producing a cabinet submission to the Auditor-General to be made in writing to the current leader of the political party of the Premier at the time the cabinet submission was lodged.

Further, under the bill, the person who provides or produces a cabinet submission in good faith to the Auditor-General is exempted from any civil or criminal liability and the provision or production of the cabinet submission is not regarded as a breach of any duty or secrecy or confidentiality imposed on the person by law. It is important to note that current policy regarding the release of cabinet documents is exactly the same framework that the Marshall Liberal government operated under. The Marshall Liberal government refused to release 21 cabinet documents requested by the Auditor-General during their term of government.

This government values deeply the importance of cabinet solidarity and confidentiality and the only people in South Australia who are entitled to cabinet documents are members of cabinet themselves. The confidentiality of cabinet deliberations is a fundamental principle of our system of government—a fundamental principle of the Westminster system of government—and it remains a cornerstone throughout these systems around the world. The government opposes this bill and will continue to operate under exactly the same framework as the previous Liberal government. We will not be supporting this bill.

The Hon. R.A. SIMMS (17:25): I rise on behalf of the Greens to speak in support of this bill. I am disappointed to hear that the Labor government will not be supporting it. The argument seems to be 'Well, the Liberals didn't do it, so we are not going to do it either.' That is not a very compelling argument, with respect to the Leader of the Government in this place. It is not a very compelling argument to say, 'Well, the Liberals were poor on transparency, so we are going to be poor on transparency, too.' We need to do better than that.

We welcome the bill that has been put forward by the Hon. Heidi Girolamo. In the Greens, we recognise that the role of the Auditor-General is crucial to scrutinise and ensure transparency and accountability of the government of the day. In his 2022 report, the Auditor-General stated that:

At the time of writing, we had requested but not received a number of cabinet documents to fulfill my legislative obligations to form opinions.

The Public Finance and Audit (Auditor-General Access to Cabinet Submissions) Amendment Bill 2022 ensures that the Auditor-General can access cabinet submissions as required to undertake their statutory duties. The Auditor-General is an independent authority and a level of separation is necessary to ensure true accountability when auditing the South Australian government; however, we need to ensure that the Auditor-General has the power they require to access records.

Most notably, in his report the Auditor-General made it clear that he had requested documents pertaining to the payment of sporting clubs and local infrastructure grants. There have been accusations of pork-barrelling over grants. Regardless of what these grants were, the Auditor-General should have had all the relevant information at their disposal to be able to make a suitable review of the processes involved. In relation to the case of sports grants, the executive director of The Centre for Public Integrity has said:

Election commitments around spending should still go through proper processes…there needs to be criteria. There needs to be open tender.

Of course, we know what can happen when that does not occur. We saw it with the Morrison government and the complete fiasco that unfolded there about the sports rorts. We do not want to see a similar culture take hold in South Australia. I am not suggesting that is what has occurred. We want to ensure there is not the potential for that kind of culture to take hold in South Australia, so this is a very important safeguard. Scrutiny of these processes is the role of the Auditor-General, but if their office does not have access to the documents they require, scrutiny is impossible.

As I said, it is disappointing to hear that the government will not be supporting this. I fear that it may suffer a similar fate to the other bill that passed this place relating to the disclosure of diaries. The Greens have been pushing for increased accountability no matter who is in government, whether it be the Labor Party or the Liberal Party. Members will recall that I put forward a bill in this place that was passed with the support of the opposition and the crossbench that required ministers to disclose their diaries. Unfortunately, that has been held up in the other place by the Labor government and I fear they are now going to stall on this bill as well.

That is a disappointing outcome because sunlight really is the best disinfectant in our democracy. We should let the sunshine in and, no matter who is in government, we should be subjecting all ministers to appropriate accountability, so the Greens will be supporting the bill.

The Hon. F. PANGALLO (17:29): I rise to speak on behalf of SA-Best on the Public Finance and Audit (Auditor-General Access to Cabinet Submissions) Amendment Bill 2022. The bill comes as a bit of a canary in the coalmine for the opposition, given the potential consequences this ties them to should they form government in the distant future.

Members interjecting:

The PRESIDENT: Excuse me. Order!

The Hon. F. PANGALLO: This bill is prompted by the decision of the government not to provide Auditor-General Andrew Richardson with cabinet documents—

Members interjecting:

The PRESIDENT: Order!

The Hon. F. PANGALLO: —which concerned $133 million in local sport and infrastructure grants. This has brought into question very reasonable concerns raised around the Auditor-General's capacity to complete his audit in full and fulfil his statutory obligations.

The Auditor-General himself has been on record stating the change of government has changed the scenario for access. In a Budget and Finance Committee hearing, when asked about his powers to access cabinet submissions and whether it would help him undertake his functions, the Auditor-General admitted that, 'Yes,' it would. The role of the Auditor-General indeed serves a critical role in the mechanisms of government accountability, transparency and integrity. SA-Best supports the work carried out by the Auditor-General and we have made that known in a survey completed recently.

The framework of this bill is designed to build in greater accountability and transparency as it pertains to the executive government and the decisions that are being made in the public interest. This is an endeavour I am in support of in principle. However, there are concerns around the necessary importance of cabinet-in-confidence and the effect allowing a government appointed statutory officer access to documents held in confidence will have in diminishing other protections where cabinet-in-confidence is needed for the proper functioning of cabinet.

There are serious considerations that must be given as to where cabinet-in-confidence begins and where it ends. Cabinet-in-confidence is a long-established principle and convention within governments across Australia, so making changes to the operations of such a convention needs to be thoroughly considered. Cabinet-in-confidence exists by convention to ensure a safe place for ministers to speak freely in confidence about issues of the day free from undue scrutiny to allow ministers freedom to explore rational options. Cabinet-in-confidence is not a simple hall pass.

In the High Court of Australia case, Commonwealth v Northern Land Council, cabinet-in-confidence and the operations of its effect on cabinet were considered and defined as, and I quote:

…[the] dominant political organ of Executive Government in our Westminster System. It is responsible for Government policy and is entirely a creature of convention.

Its Ministers are collectively responsible for the decisions it makes, so Ministers are effectively taken by convention to be of one mind and voice.

Walter Bagehot in the English Constitution explains the separation of the Executive and Legislative arms of government 'through the agency of Cabinet as the latent essence and effective secret of the English Constitution'.

The protection of Cabinet confidentiality is accepted as a necessary feature of the Westminster systems and as 'an important element in our system of government'.

In the Northern Land Council case, the High Court observed that the protection of cabinet-in-confidence is afforded on the basis that disclosure may precede the formal announcement of cabinet decisions and may diminish adherence to cabinet responsibility by revealing the individual opinions of cabinet members. In other words, without cabinet-in-confidence, further erosion of public trust of executive government as an institution would occur.

Cabinet-in-confidence is not an absolute shield and I agree that, in appropriate circumstances, government decisions made by the executive in cabinet should be subjected to scrutiny, but the question of what mechanism of scrutiny must be debated. Should such scrutiny of decisions related to public finance decisions made by cabinet be scrutinised by the representatives of the public—us, the members of parliament? Or, as this bill seeks to establish, do we expand on the powers of the Auditor-General as an appointed authority on the government to perform the role of scrutinising such affairs?

There is a real and genuine public interest debate to be had if we are to consider powers with respect to access to information and decisions made by cabinet. Does the public interest in the administration of the Auditor-General's functions outweigh the very high interest of preserving confidentiality? We already have jurisprudence on this issue with the High Court authority of Egan v Willis. The court found that legislative chambers in Australia have an implied power to compel their members to produce papers to the house, together with an implied power to counter obstruction where it occurs.

In particular, the New South Wales Legislative Council had the power to compel Michael Egan, the then Treasurer, Minister for Energy, Minister for State Development and minister assisting the Premier, to produce certain documents to the chamber. When he refused to do so, the forced removal of him from the chamber by the Usher of the Black Rod did not constitute a trespass. While this case did clarify the legislative chamber's authority to compel documents, no decision in this case was ultimately made in relation to the production or forced production of the documents to the chamber.

The opposition makes the point that, when in government, they agreed to an undertaking with the Auditor-General in 2019 to improve transparency and accountability, which is reflected by a Premier and Cabinet circular. The bill, as I understand it, is based on this circular, albeit with the removal of the Premier veto powers. I cannot help but wonder why, if they had struck an agreement with the Auditor-General, the opposition did not legislate this exact bill while in government.

A non-binding promise to do something means very little now when the power to follow through with that change has come to pass and only now in opposition, to get one back on the government, has this bill come before us. I note that changes like this bill took place in Western Australia, where the McGowan government sought to shine a light on itself by providing greater access to the Auditor-General to certain categories of documents, which aligns with New South Wales legislation of a similar type.

The Auditor-General's Report was critical of the Labor government administration of payments totalling roughly $133 million for local sporting clubs and infrastructure grants, or what observers consider pork-barrelling, a tool of the government utilised to produce results for members' constituencies in building up their communities.

This is not unique to either side of politics, with the opposition being as guilty of pork-barrelling as the current office holders. But can you label this as corrupt when the benefit is for the community? The answers the Auditor-General is seeking are whether proper processes and assessments need to be followed by government departments with grant allocations rather than fulfilling an election promise.

One particular concern I hold with respect to this bill is privilege. We sought an opinion from the South Australian Law Society, who queried whether there could be litigation arising from a challenge to what constitutes a non-waiver of privilege or immunity and whether section 34A(4) is sufficient to maintain those immunities and privileges. I note that section 34A(5) appears to provide the provision that a cabinet submission to the Auditor-General does not waive parliamentary privilege, legal professional privilege, public interest immunity and any other confidentiality, privilege or immunity.

Other aspects of this bill where consideration is not certain, and perhaps this goes beyond the scope of the purpose of the bill, is what impact does the Auditor-General having access to and holding within his agency cabinet documents have on freedom of information requests? By holding cabinet documents within its agency, does this open the Auditor-General's Department to freedom of information requests for information related to documents extracted from cabinet as part of the audit? Whether such requests result in rejections under the confidentiality provisions of the FOI Act are only one consideration. How much additional resourcing to deal with the potential for these requests will be needed for the department?

In principle, we are supportive of the bill, given it provides a platform for greater transparency and accountability for the decisions made by executive government in cabinet. I remain hesitant on the path which is being taken to achieve these integrity outcomes against the necessity to uphold the conventions of cabinet-in-confidence.

The Hon. S.L. GAME (17:40): I rise briefly to support the Public Finance and Audit (Auditor-General Access to Cabinet Submissions) Amendment Bill. The Public Finance and Audit (Auditor-General Access to Cabinet Submissions) Amendment Bill will allow the Auditor-General to access cabinet submissions, allowing for their job to be fully informed and completed properly and effectively. This amendment will grant more government transparency and accountability.

I remind the chamber that last November I asked the Attorney-General about cabinet documents that the Premier refused to release seven times to the Auditor-General, which impacted and undermined the whole audit process. One Nation supports keeping the government accountable, and I support the opposition in its attempt to pass this bill in the chamber.

The Hon. H.M. GIROLAMO (17:41): I will just start by thanking honourable members for their contributions and support on what is a very important bill. What I can indicate to you is that, as the Leader of Government outlined, there were similar processes in place, but the Auditor-General never raised concerns about the Liberal Party not having transparency and not giving access to documentation, whereas the Auditor-General has indicated that documentation has been requested and not provided.

By legislating this, which has been done in both WA and New South Wales, it will strengthen that transparency and allow access to that documentation within cabinet. I have full confidence that the Auditor-General has guidelines to be able to ensure confidentiality within those remits and, as a former auditor, I do find it quite concerning that the Auditor-General does not have access to all documentation to be able to fulfil his obligations from a financial statement perspective.

I would also like to thank the Hon. Frank Pangallo for his interest in this area and being able to delve into things because they are not always black and white. I do appreciate his comments and contributions. What I can say is that there were on many occasions requests by the Auditor-General and that information was provided—the documents that the Attorney-General indicated were cabinet notes rather than documents, so I do find it very interesting. There is always an ability to put self-interest and lack of transparency from the government's behalf first. I am disappointed that they will not be supporting this bill. I do hope that it is able to progress further, but I do have concerns given the numbers in the other place.

From our perspective, if it was good enough for the New South Wales government, while they were in government, and good enough for the WA government to put these forward, then it should be good enough for the South Australian government to put this bill forward in their own name as well. From my perspective, South Australians deserve to have transparency within the financial data and understand where their money is being spent. I think this bill goes a long way to ensuring that transparency, so thank you to members of the crossbench for their support.

Bill read a second time.

Committee Stage

Bill taken through committee without amendment.

Third Reading

The Hon. H.M. GIROLAMO (17:46): I move:

That this bill be now read a third time.

Bill read a third time and passed.

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