A personal view of Australian and International Politics : Coalition’s proposed anti-corruption commission would have no power to investigate recent controversies.

Friday, 9 July 2021

Coalition’s proposed anti-corruption commission would have no power to investigate recent controversies.

Guardian analysis finds body lacks power and threshold too high to begin investigations, meaning car parks and sports rorts, and questions about expense claims would avoid scrutiny

Many federal parliament integrity controversies reported in recent years would avoid scrutiny under the Coalition’s proposed anti-corruption commission.

Christopher Knaus, Nick Evershed, Rafqa Touma and Natasha May

Fri 9 Jul 2021 03.30 AEST

Last modified on Fri 9 Jul 2021 03.31 AEST

The Coalition’s proposed federal anti-corruption body would have no power to investigate dozens of integrity, expense and pork-barrelling controversies that have come to light in recent years, the Guardian has found.

An analysis of 40 political controversies, conducted jointly by Guardian Australia and the Centre for Public Integrity, has found that all but two would fall well short of the threshold the proposed body requires to begin an investigation.

The Commonwealth Integrity Commission – described by the government as a “centralised, specialist centre investigating corruption in the public sector” – would be unable to investigate the recent car park rorts or sports rorts affairs, despite evidence that taxpayers’ money was being redirected for political gain.

Nor would it be able to investigate a string of questions about expense claims or concerns over the provision of flights to former finance minister Mathias Cormann by the Liberal donor and government contractor Helloworld. The awarding of contracts to Liberal-linked firms would also avoid the body’s scrutiny, as would the infamous Parakeelia, Paladin, and Nimrod Resources scandals.

Under the draft legislation, the CIC needs to have a “reasonable suspicion” that a listed criminal offence has been committed before it can even begin investigating.

The Centre for Public Integrity says it is this high bar that would stymie the CIC’s attempts to examine most of the controversies identified by the Guardian.

“The government’s proposed CIC will not be able to do its job – the threshold is too high to begin investigations, and the public is left in the dark without open hearings or public reporting,” said Anthony Whealy QC, chair of the Centre for Public Integrity.

“Public trust will continue to fall while scandal after scandal is met with no real consequence.”

Car park rorts scandal: pork barrelling from the car park commuter fund

A $660m car park commuter fund was overwhelmingly used to fund sites in Coalition-held electorates prior to the election. The program was criticised by the auditor-general, who found it was “not effective” and the approach to selecting the sites was “not demonstrably merit-based”. None of the It said none of the 47 project sites selected for funding commitment had been proposed by the infrastructure department.

Sports rorts: pork barrelling from a community sports infrastructure fund

The use of sport infrastructure grant money to allegedly pork barrel and direct money towards marginal or targeted electorates in the lead-up to the 2019 election. The scandal led to the resignation of minister from cabinet after she was found to have breached ministerial standards for failing to declare her membership of a gun club that received grants. She maintained that her membership of the club did not influence her decision making and that she did not receive any personal gain.

Pork barrelling from the Community Development Grants Program

About 75% of the $3bn spent via the Community Development Grants Program went to Coalition seats.

Pork barrelling from the Urban Congestion Fund

Of the $3bn spent in the Urban Congestion Fund, 83% went into Coalition or marginal Labor seats.

Pork barrelling from the Female Facilities and Water Safety Stream

The $150m Female Facilities and Water Safety Stream Program – meant for the provision of female changing rooms – was overwhelmingly used to build swimming pools in 11 Liberal and National party–held seats. About 40% of the program's funding went to two seats (Corangamite and Pearce). Both were marginal Liberal seats.

Grant redirection from the Safer Communities Fund

According to the ABC, former home affairs minister Peter Dutton slashed grant funding by millions against the recommendations of his department and instead directed money towards his own handpicked list. The report also alleged that he used funds to support grants for two councils in the lead-up to a local byelection, again against departmental recommendations. Dutton described allegations he acted inappropriately as “baseless”, saying: "The suggestion that the government has done anything other than support projects worthy of support is nonsense."

Great Barrier Reef Foundation grant

The private Great Barrier Reef Foundation was awarded an unprecedented $443m grant of taxpayers money by the Turnbull government, which was allegedly not properly tendered and failed to follow proper transparency rules. Turnbull defended the government’s “very thorough process” before the grant, explaining that both the expenditure review committee and cabinet had approved it before the money was offered. The prime minister said the government had not put the grant out to a competitive tender because the foundation was an “outstanding” organisation and “were clearly the best team to do it”

Helloworld flights

Mathias Cormann and his family were not charged for a family trip to Singapore booked with Helloworld in 2017, months before the company won a $1bn travel contract with Cormann's own department. When notified Helloworld said it was an administrative error and Cormann subsequently paid for the trip, revealing he had booked private travel by calling Andrew Burnes, Helloworld chief executive, directly three times. Cormann said at the time that he played no direct role in procurement as a matter of routine, and was “extremely cautious” in relation to the Helloworld contract. He also said: “I’ve got a close personal relationship with Mr Burnes, and I don’t think that it is unusual to ask somebody who owns a business to sell products and services to you on commercial terms.”

LNP President takes a job with rival party leader Clive Palmer

Queensland’s Liberal National party president David Hutchinson secured a job with Clive Palmer as a consultant on the businessman’s shuttered Coolum Resort just months after the pair struck a preference deal, helping the Coalition win government. Despite the businessman being the leader of the rival United Australia Party, Hutchinson defended his decision to take the job and said he did not believe it was inappropriate or would anger LNP supporters. “Business is business and politics is politics,’’ he said at the time. “It’s not inappropriate, I’m keen to see the Coolum Resort reopen and help bring back those jobs to the region."

Paladin scandal

The Department of Home Affairs attracted significant scrutiny and controversy for awarding Paladin (a small and relatively unknown firm) a series of contracts worth $423m to provide services to asylum seekers on Manus Island through a limited tender process with no other bidders. Arianne Kassman, executive director of Transparency International PNG, said at the time that the public needed an explanation about “how deals like this are being allowed to take place’. In defending the Paladin contract, the department said it was working in difficult and urgent circumstances, which required a limited tender process.”.

AAT appointment of former Coalition politicians

The appointment of former Liberal and National MPs to well-paid and taxpayer-funded roles with the administrative appeals tribunal. In 2019 shadow attorney general Mark Dreyfus accused the government of “stacking the AAT with Liberal donors, former MPs, former staffers and mates

Appointment of former Coalition politicians to various boards and roles

The appointment of former Liberal and National MPs to highly paid jobs in diplomacy, peak industry bodies and board positions, as part of what Crikey reported was a "determination ... to compensate MPs who lost seats".

The awarding of Covid-19 vaccine contracts

The Australian government funnelled millions of dollars to private contractors for its beleaguered Covid vaccine rollout using opaque deals – some of which are hidden from the public and ignore transparency standards. Some of the recipients included companies that have made donations to the Liberal party. In response, the health department said it had "conducted competitive procurement processes to identify the best value for money options for the provision of services relating to the vaccine rollout."

Attorney General appoints party donor to appeals tribunal

Former attorney general George Brandis was criticised by his Labor counterpart for appointing a party donor and lawyer with a reported connection to his son, to a $370,000 a year role with the Administrative Appeals Tribunal without flagging a potential conflict of interest. Brandis denied there was any conflict of interest, saying the appointment was entirely within the agreed protocol for appointments. He also said he was not aware of the man's previous donation to the party of $1300 in 2013.

"Political research" paid for by taxpayers and not publicly disclosed

The PM's department and office were criticised for lack of transparency after failing to disclose market research held by them that had been carried out under a $500,000 taxpayer-funded contract by a former Liberal party pollster. Labor has criticised the work, which fed into government advertising campaigns related to the economic impact of the pandemic, as “thinly disguised political research” being funded by taxpayers rather than by the Liberal party, as would be the convention.

Travel expenses: Murdoch Christmas party

Scott Morrison and Josh Frydenberg billed taxpayers almost $5,000 to take the prime minister’s private jet on a whirlwind trip to Sydney on the night of Lachlan Murdoch’s Christmas party. While Morrison lives in Sydney and was travelling with his family from Canberra, Frydenberg failed to explain how his trip constituted parliamentary business or answer whether the Murdoch party was his primary purpose for travel.

Travel expenses: Channel Nine fundraiser

Three cabinet ministers charged taxpayers more than $4,500 for an overnight trip to Sydney during which they mingled with mining and banking donors at a lucrative Liberal party fundraiser hosted by Channel Nine. While all three say they were within the rules because they were in Sydney for other parliamentary business in the hours either side of the fundraiser they did not say whether they were invited to the fundraiser before booking the parliamentary business that coincided.

Travel expenses: Melbourne Cup

Michael McCormack and his wife flew to Melbourne on a VIP government jet before the Melbourne Cup, celebrated in the marquee of gambling giant Tabcorp, billed taxpayers for their return flights, and justified the trip by reannouncing a three-year-old funding pledge for a sports hall at an event that dismayed local councillors. A spokeswoman for McCormack said the Independent Parliamentary Expenses Authority had already confirmed the travel claims, including the use of family reunion travel, were within the rules. Documents later released under freedom of information revealed that IPEA opened up a broader investigation of McCormack’s travel following the initial Guardian report. The authority examined his travel claims on and around the dates of a series of major sporting events in 2019 and found nothing to suggest he had breached legislative requirements.

Travel expenses: Adelaide fundraiser

The shadow health minister, Chris Bowen, billed taxpayers $2190 for a four-hour trip to Adelaide where he was the guest of honour at a two-hour Labor fundraiser. A spokesperson for Bowen said that the event was not the dominant purpose of his trip and that no public funds were spent for his attendance at the function. They said Bowen held a press conference while in the city and said he had also met with stakeholders and had meetings relevant to his shadow ministerial role.

Travel expenses: Julie Bishop polo event

The ABC reported Julie Bishop charged taxpayers $2716 in travel expenses to attend the 2016 Portsea polo event on Victoria's Mornington Peninsula as a guest of Peroni and Jeep. In response to the ABC, a spokesperson for Bishop said: "The minister was invited and attended in her official capacity as minister for foreign affairs and deputy leader of the Liberal Party." Ministers are allowed to claim for travel relating to their office, but the ministerial standards prohibit travel for private purposes.

Travel expenses: Sussan Ley

Sussan Ley took a taxpayer-funded trip to the Gold Coast in 2015 where she bought an investment property. Ley’s spokeswoman said at the time the property purchase was “not planned nor anticipated”. “Minister Ley’s partner was invited to accompany her to a function in Sydney on the Friday evening. He then travelled with the Minister to Queensland under family travel arrangements. The EMB (Entitlements Management Branch) was consulted at the time to confirm Ms Ley’s partner’s travel was within the rules. All travel undertaken was in accordance with the rules.”

Travel expenses: Bronwyn Bishop

Bronwyn Bishop spent more than $5,000 to charter a helicopter from Melbourne to Geelong for a Liberal party fundraiser when the estimated travel time by road is about 90 minutes each way. Bishop said at the time that the charter was an “error of judgment”. “You know, that helicopter, yes, I was short of time,” she said. “But it is no excuse, and it was an error of judgment. And really, as I said, I want to apologise to the Australian people, becauseI feel I’ve let them down.”

Travel expenses: AFL grand final

Two federal government ministers and a Tasmanian senator who charged taxpayers for a trip to the AFL grand final in 2013. Mathias Cormann billed taxpayers for airfares to attend the match with his wife. Cormann’s office at the time said he had “official commitments before, during and after the AFL grand final weekend”.

Travel expenses: Tony Abbott's farewell party

Peter Dutton, Eric Abetz and Kevin Andrews billed taxpayers thousands of dollars for an overnight trip in 2019, during which they attended a farewell party for Tony Abbott. Andrews’ office said he was in Sydney to attend an Aged Care Royal Commission consultation with the prime minister. Dutton and Abetz’s office did not respond to requests from the New Daily for comment.

Travel expenses: George Christensen travel to Philippines

George Christensen billed taxpayers for extensive travel relating to his trips to the Philippines. Christensen referred his travel to the Independent Parliamentary Expenses Authority and paid back the cost of the trips. He labelled reports about his travel to the Philippines as part of a “disgusting smear campaign”. The IPEA audit found one domestic flight and one COMCAR journey failed the dominant purpose test in section 26 of the Parliamentary Business Resources Act 2017 (PBR Act).

Parakeelia and software allowances

The flow of money between the Liberal party and its software company Parakeelia, which receives hundreds of thousands of dollars a year in money originating from taxpayer-funded allowances.

Government purchase of water licenses

Questions around Angus Taylor's interest in Growth Farms Australia and the company's connections to the sale of water to the federal government. At the time, Taylor has said he played no role in the water sale and was not aware of it until it was announced. He has said that neither he nor his family benefited from the water transaction. There is nothing to suggest that is untrue.

Leppington Triangle scandal

The federal government paid $30m for land near the proposed Western Sydney Airport, despite it being valued at just $3m a year earlier.

Stuart Robert and Nimrod

As minister for human services, Stuart Robert went to Beijing to oversee the Nimrod Resources project, a mining deal involving a major Liberal donor. An internal investigation by Martin Parkinson found he had a shareholding in Metallum Holdings, which had an interest in Nimrod Resources. At the time, Robert told Parkinson that when he travelled to Beijing, he did not believe he had any interest or connection with the company. “In the course of assisting the investigation, Mr Robert advised Dr Parkinson that on checking his records he had become aware that shares in Metallum Holdings Pty Ltd, a company in which Mr Marks was also a shareholder, had been allocated to his trustee some time before the visit to Beijing,” then prime minister Malcolm Turnbull said. “He told Dr Parkinson that this had been done without his knowledge.”

Stuart Robert director of company that received government contracts

Fairfax Media investigated Stuart Robert's business dealings and found he had direct financial links with a company awarded millions in government contracts. Robert denied the shareholding breached consitutional requirements banning MPs from having "any direct or indirect pecuniary interest in any agreement with the Public Service of the Commonwealth". At the time, Robert said he did not intend to expand on the matter. "This is seven years ago, my affairs were well-structured when I entered Parliament to avoid any issues and I don't intend to expand on it," he said.

Altered document used by Angus Taylor's staff to attack Clover Moore

An altered document was used by Angus Taylor's staff to falsely attack Sydney lord mayor Clover Moore over her council's emissions record and travel expenses. Taylor apologised for the error and says his office downloaded the erroneous document from the council’s website in early September before providing it to the Daily Telegraph, which subsequently ran a piece attacking Moore’s travel expenditure and associated emissions. That version is disputed by the City of Sydney. It remains unclear who altered the document. There is no suggestion that Taylor himself was responsible. The AFP considered the matter and declined to investigate.

Pork barrelling with the bushfire disaster fund

The use of bushfire disaster fund grants to pork barrel. At the time, deputy premier John Barilaro’s office said it was “downright offensive” to suggest the projects that had been funded were unworthy. “The only people who are politicising the projects are [Greens MP David] Shoebridge and Labor as they attempt to undermine the good work this government is doing,” he said.

Stuart Robert's internet expenses

Stuart Robert spent $38,000 on taxpayer-funded home internet bills from 2016. At the time, the minister said he was only able to access mobile broadband services that had limited monthly downloads available, and he had switched to a 4G connection because “my family home is located a significant distance from the telephone exchange, resulting in poor connectivity”. “My internet, like many in semi-rural areas, was previously unreliable, which interfered with my ability to perform my parliamentary and ministerial duties.”

Barnaby Joyce's new offices

Barnaby Joyce spent $670,897 for two offices in his New England electorate, a move that had earlier been described as “pork barrelling” by Labor senator Sue Lines. Joyce defended the cost in a statement, saying the Armidale fit-out was cheaper than the equivalent would have been in the Sydney CBD. “It would be vastly different, vastly more expensive if they had built it where they had proposed to build it, which is in Sydney,” he said.

Asic payments

Asic paid KPMG consultants $118,000 for chairman James Shipton's own personal tax advice. Asic also paid $70,000 in rental payments to deputy chairman Daniel Crennan QC to help him relocate from Melbourne to Sydney. Both men denied wrongdoing and have subsequently repaid sums. At the time, Shipton said: “I have advised the treasurer this afternoon that, in the circumstances, it is appropriate to stand aside pending the outcome of the review. Whilst I believe that I have acted properly and appropriately in this matter, I hold myself to the highest possible standard.”

Scott Morrison's bushfire advertisement

The government released a video praising their bushfire response, which was authorised only by the Liberal party and Scott Morrison personally, rather than the Australian government. Morrison denied the video was an advertisement, and rejected suggestions it was politically motivated. “It wasn’t a Liberal party-sponsored ad, it was authorised by me – I’m the leader of the Liberal party – that’s the only authorisation I can post on something that is posted on my page,” he said.

Australia Post/Cartier watch controversy

Four Cartier watches were given to senior managers at Australia Post (a company owned by the government) in 2018 as a reward worth nearly $20,000 in total. Christine Holgate says she was then forced from her role as chief executive. She maintains she did nothing wrong and is planning to take the government to court. She said she had bought four Cartier watches in October 2018 for “a small number of senior people who had put an inordinate amount of work in” to a project to allow more people to do their banking at post offices.

The au pairs controversy

Peter Dutton intervened to grant visas to two au pairs, one of whom went on to work for the family of an old police colleague. Dutton’s office said he had received hundreds of representations on individual migration matters from MPs, journalists, members of the public and others every year. “Suggestions that somehow there is impropriety or some personal gain is completely false,” he said. He also said he considered cases on their merits and any suggestion otherwise was “completely ridiculous”.

Barnaby Joyce and the drought envoy role

Barnaby Joyce was employed as a drought envoy while a backbencher, where he spent $675,000 in expenses but less than three weeks on the ground in the role. He did not produce a final report. The $675,000 figure includes Joyce’s normal work as a backbencher, but the government has declined to say how much was related to his work as special envoy. Joyce, at the time, reacted angrily to claims he had not produced a final report, saying he sent “an awful lot” of correspondence to the prime minister, Scott Morrison, including by text message, about his findings as drought envoy.

Prof Anne Twomey, one of the country’s most respected constitutional experts, is scathing in her assessment of the proposed CIC and the high threshold of suspected criminality it requires to begin an investigation.

“We already have people who investigate criminal offences,” Twomey said. “They are known as police. We also have people who prosecute those offences.

“The reason for having an anti-corruption body is to do something different – to investigate behaviour which is corrupt, but does not necessarily amount to an offence.”

Twomey said the CIC has been designed in a way that “would exclude almost everyone who is aware of the corruption from informing the CIC of it”. Members of the public, public servants, ministerial advisers and office staff are not able to make a referral when they become aware that a member or minister is behaving corruptly.

“This is a shamefully inadequate system, which appears designed to protect the corrupt from investigation,” she said.

The Australian Human Rights Commission believes the CIC must be able to investigate allegations of potential “serious non-criminal corruption” if it is to be “effective and credible”.

Guardian Australia also analysed whether, absent any form of anti-corruption body, integrity controversies were leading to other forms of inquiry or consequences for those involved. In about half the cases, they did not.

Questions about expenses can be investigated by the Independent Parliamentary Expenses Authority, but it has limited powers to investigate and punish misuse, and does not disclose which matters it is reviewing to the public.

Our political culture is now at the point where MPs and parties think they can get away with serious allegations without serious action

“Our political culture is now at the point where MPs and parties think they can get away with serious allegations without serious action,” Whealy said.

“A National Integrity Commission with strong powers and a broad jurisdiction is urgently needed to investigate allegations of misconduct.”

Twomey said the CIC could not be regarded as seriously addressing concerns about potential “corruption or public integrity” until it was given the remit to investigate officials and parliamentarians suspected of acting dishonestly, with bias, contrary to the public interest, or for the personal gain of themselves, their associates or their political parties.

The CIC cannot take public tipoffs, cannot hold public hearings, and is restricted from making findings of corrupt conduct.

Twomey also identifies a more fundamental problem. She says the wording of the legislation is such that ministers can only be engaging in corrupt conduct if they are abusing their position as a parliamentarian – separate from their position as a minister – while committing one of the listed offences.

“A minister could be utterly corrupt in awarding grants, in approving contracts, in making decisions about granting visas, acquiring land or approving mines or infrastructure projects,” Twomey said. “The minister could be accepting bribes in the millions or acting for the benefit of family and friends, against the public interest, and yet it would still not be regarded as corruption that could be investigated under this proposed Act.”

Prof AJ Brown, an expert on integrity at Griffith University and a board member of Transparency International Australia, reviewed and added to the list of controversies compiled by the Guardian and Centre for Public Integrity.

Brown said that even if the classification of some of the controversies might be arguable, it was clear the CIC would fail the “pub test”. Most citizens would expect a thorough and independent inquiry into any possible wrongdoing, which would not happen in these cases.

“The problem is not only the narrow jurisdiction of the CIC, but the fact we know that no other independent agencies are currently positioned to pick up the job in its place, despite all the talk of a strong multi-agency system,” he said.

Transparency International has previously found that “grey area” allegations of potential corruption – including allegations relating to potential conflicts of interest, procurement problems or favouritism – would not be able to be investigated, absent evidence of a criminal offence.

Whistleblowers are being scared into silence, hampering efforts to expose corruption in Australia, research finds

Unless the jurisdiction was broadened, Brown said, issues would “continue to fall through the cracks” and would continue to both cause “political headaches” for governments and feed public distrust.

The criticism of the CIC comes from unexpected quarters, too. The Australian Federal Police Association last year told the Guardian the body acts as a “protection racket” for government MPs. The Police Federation of Australia is also furious at rules exposing law enforcement to harsher scrutiny than MPs and wants the government to revert to a “one-rule-for-all” system.

Even government watchdogs have concerns about the uncertainties and ambiguities in the current draft. The inspector general of taxation, for example, says it is unclear how the CIC would interact with current whistleblowing laws.

The new attorney general, Michaelia Cash, was given a chance to comment on the list of controversies analysed by Guardian Australia.

Her office said it would not do so, because the “information provided in an attempt to criticise [the] CIC is selective, partisan and politically motivated and therefore it would be inappropriate to comment”.

Cash’s office was invited to identify integrity controversies that would fall into the remit of its proposed CIC. It did not respond.