The case for a Federal ICAC
On May 15 this year, the Australian Greens Leader, Senator
Christine Milne, unsuccessfully introduced a bill to create a national
anti-corruption body. She makes a powerful case, raising many very
concerning examples. Every Australian should read what she had to say.
“The federal government is the only jurisdiction without the
infrastructure to confront corruption. Every time wrongdoing is exposed,
one-off reviews or ad hoc investigations are launched.
I want to take this opportunity to congratulate the people blockading
at Bentley against Metgasco because today the New South Wales
government has suspended the licence that was granted because there was
no consultation with local people and because, through the Independent
Commission Against Corruption investigations, it is pretty obvious that
the licences were given wrongly. But it should not take ordinary
citizens taking the action that they have to hold governments to
account, to make sure that licences are not given as a result of money
paid behind the scenes or undue influence or favours in any other way.
And now for the third time the Greens have this bill before the
parliament to create this office to crack down on public sector
corruption and promote integrity in our public institutions. In fact I
cannot see why anybody would oppose setting up a national ICAC, and I
will be very interested to hear what excuses are offered. It is pretty
obvious that corruption does not end at the border of New South Wales;
it does not end at any other state border. When you consider the
likelihood of corruption in the federal arena, it is pretty
overwhelming. So many major projects are dependent on some federal
licence being given, some engagement with a federal agency. Therefore,
there is a huge temptation for people, both at the political level and
in the bureaucracy, to engage in talking with lobbyists-and who knows
where it will end up.
I want to give an example that is on the go right now. You have the
financial services industry, which did not like one little bit the fact
that in the last government Labor and the Greens moved to change the law
to require those people in the financial services industry to act in
the best interests of their client. Now what is wrong with someone being
required to act in the best interests of their client? You would expect
that to be the case. But what has been revealed is that in a whole lot
of the managed investment schemes, for example, the financial advisers
were not telling the people they were selling the products to of the
massive kickbacks that they, the financial advisers, were getting as a
result of recommending that product. So what happened? The financial
advisers became rich, but the people who bought the product, well those
people lost and lost out badly.
When I think of the tragedy of the people who were sucked into buying
from Great Southern Plantations, Gunns and the rest, you have to ask
the question: how on earth did the financial services industry get to
the point where it was able to con the parliament into agreeing that it
could sell a product without having to act in the communities’ or its
clients’ best interest?
Now we have a situation where the financial services industry has
persuaded Prime Minister Tony Abbott’s government to change the act back
to remove the need for financial advisers to act in the best interests
of the client. And we what do we find? We find that the financial
services industry is part of the North Sydney Forum, which is a
fundraiser for the federal Liberal Party-in particular, Treasurer Joe
Hockey. What does that tell you about the influence of lobbyists-the way
that lobbying groups get involved in private fundraising engagement
with political parties? The delivery is given here in parliament in
terms of outcomes. And it is entirely secret. Until this was forced out
recently, nobody would have known about that backroom dealing that was
going on.
That is why it is critical. The same thing goes with novated leasing
and a whole range of things, including the salary packaging industry.
That industry is in there with the car industry to set up a situation
where you can minimise your taxable income by going through this lurk of
novated leases. We got rid of it in the last period of government, and I
see that the current Liberal Party is about to restore the rort.
That is the kind of thing that goes on, and that is why the community
is getting increasingly frustrated and wants to have some reassurance
that there is some way of investigating what they can clearly see is on
the verge of corruption, if not corruption.
In this Greens legislation, the National Office of Integrity
Commissioner is modelled on the successful New South Wales Independent
Commission Against Corruption. It is based on provisions in the Law
Enforcement Integrity Commissioner Act 2006. The first part of it is
about the National Integrity Commissioner, and that is concerned with
corruption in relation to public officials and Commonwealth agencies,
and has full investigative powers, including public and private hearings
and summoning any person or agency to produce documents and appear
before the commissioner.
I think that is fair enough. Why shouldn’t public officials,
Commonwealth agencies and parliamentarians be subject to that kind of
oversight in the federal parliament? I will give you an example-it
happened recently-which many people will have read about. Just in this
last month we saw two men-one from the Australian Bureau of Statistics
and another working with the National Australia Bank-using unpublished
unemployment, retail and trade data at the Bureau of Statistics to trade
in foreign exchange derivatives. Somebody working in a government
agency was working with someone in the private sector and using that
information. That insider trading brought in millions of dollars to the
two men, but in this case it has been picked up by our criminal justice
system. I am glad it has been picked up by our criminal justice system,
but it may not have been. What pathways do members of the community have
to put forward matters and have them investigated?
I want to go to another example-the issue of Securency, a subsidiary
of the Reserve Bank. Mr Warburton has been appointed by Prime Minister
Abbott to review Australia’s renewable energy target. We know that he
has been the subject of a secret internal investigation into his role as
a former director of a firm involved in Australia’s worst foreign
bribery scandal. That investigation and those findings by KPMG were
sent, in February, to the Reserve Bank Board. They deal not only with Mr
Warburton and his fellow former Note Printing Australia directors but
go to the knowledge of, and handling by, Note Printing Australia’s
sanctions-busting trip to Iraq in 1998. Yet yesterday, when I sought the
parliament’s approval to put that document on the table of the
parliament so that we can know what exactly went on and what KPMG found
out about those directors-in particular, Mr Warburton-the government and
the opposition voted together to prevent the Senate order that would
have required that report to be tabled in the parliament. I put the
question: why shouldn’t the parliament have access to that KPMG report
on what has gone on?
I want to give another example. One of my constituents, who I will
not name, is a fisherman in Tasmania. He was approached by two Austrade
officials in Japan. He was asked to provide fish to this supposedly
Japanese businessman who they vouched for. They said he was a credible
person and that they had done the due diligence. They said that the
government wanted this trade in order to develop the relationship with
Japan in high-quality seafood. So this fisherman went ahead and did it,
at the request of Austrade. He was quite happy with his own business. He
did not need this business but he went ahead with it because they asked
him to.
The long and the short of it is that he provided the fish to this
place in Japan-to the businessman whose bona fides Austrade vouched for.
After a while the fish were collected but no payment was made. Later it
was revealed that there was no such businessman. The person that
Austrade had vouched for did not exist. Austrade had invited my
constituent to get involved with a shonk. Why? In order to justify the
Austrade office in Nagoya they had to show that they were turning over a
certain amount of business. So they set up this whole thing. The result
of it is that my constituent went broke, and the department backed
their two officers to the hilt.
There was no natural justice in this. As far as I know, those two
officials remain employed in Austrade. I think it is totally wrong. I
have pursued it every which way, seeking natural justice for this
person. But the bigger question here is: how many other Austrade
officials around the world are setting up similar kinds of scams and
presenting figures to the federal government on the extent of the
business that they are engaged in when, in fact, it has all been set up
to secure their postings rather than the business that was supposedly
there to be delivered?
I will give you another example, under the Green Loans scheme in the
last period of government. It was riddled with incidents of
inappropriate behaviour from some public servants, who favoured
particular suppliers. They split contracts so that they did not have to
go to competitive tender. The audit reports into the scheme make for
deeply troubling reading, with systematic breaches of procurement
policies and basic financial management regulations. The question is:
was it just maladministration or sloppiness? Were they under pressure to
get these Green Loans and audits out the door? Did they do this in
order to facilitate a government policy, to get it out the door? Or were
any kickbacks paid? What actually was done when the audit reports came
in and showed there were serious questions to be answered?
The public does not know, and neither does this parliament. Those of
us who have constituents bring these things to us have no mechanism to
have them investigated. And if we cannot actually give enough evidence
for a breach of a criminal kind it goes nowhere. Well, I think that if
it is good enough for the states to recognise that there is a high risk
of corruption and that they want to actually try to eradicate
corruption, then at the very least the federal parliament should go
there as well.
It also goes to our international standing. We are a signatory to two
important anticorruption conventions: the United Nations Convention
Against Corruption, which entered into force in December 2005, and the
Organisation for Economic Cooperation and Development Convention on
Combating the Bribery of Foreign Public Officials in International
Business Transactions. This is another one where Transparency
International has previously criticised Australian law for its low and
ineffective penalties for corruption. It found, in its 2009 report, that
Australia made little or no effort to enforce the OECD Convention on
Combating the Bribery of Foreign Public Officials in International
Business Transactions.
I will give you another example: in Zambia, as I stand here, there is
an Australian mining company over there trying to get a licence to put a
mine in one of their biggest national parks. It was refused by the
environment agency in Zambia but then that was overturned by a minister
in that country. International NGOs have alleged clearly that money
changed hands. And yet you have an Australian state government backing
this company to the hilt. What is the arrangement? Who is involved in
this?
You have the United States currently investigating BHP in China in
relation to corruption. This was one of the things referred to the
Australian Federal Police. It was not taken up by the Federal Police,
but I raised it at the last estimates and they now have.
Equally, in Macau, where the Chinese took action against a citizen
there for bribery in relation to casino developments-in particular,
Crown casino developments. The Chinese citizen was jailed there for
taking a bribe of $100 million to free-up the land for the casinos and
provide the licences. And yet when that was referred to the Federal
Police to look at from our end, what was done? Zilch, zero-nothing! Now,
why? Why are we allowing this to happen? I would like to have a very
considered explanation from my parliamentary colleagues in other
political parties here as to what they could possibly have against
setting up a national integrity commission-a commission against
corruption.
The other thing we need to do is to reassure the public that the
entitlements we get are appropriately accessed and spent. That is why as
part of this National Integrity Commission, the Greens are saying that
we want a new Office of the Independent Parliamentary Adviser, to advise
MPs and ministers on entitlement claims and the ethical running of
their offices that the public rightly expects. That adviser that would
be tasked with developing a legally-binding code of conduct for MPs for
the parliament to adopt.
Of course, this goes to the heart of the recent wedding scandal,
where people had claimed expenses to go to various weddings, functions
and so on, and the question was really: were those really for
parliamentary business or were they using an entitlement just because
they could get access to it? There was the famous case here, many years
ago, of an MP who flew to Perth and back and who did not leave the
airport lounge, simply to get the entitlement in relation to frequent
flyer points. This was using a public, taxpayer funded fare to fly from
the eastern states to Perth, sit in a lounge, have lunch and come back
in order to get the frequent flyer points. This is why we have had the
awful scandal in the last parliament with the former Speaker, Peter
Slipper, and allegations made about him and his use of entitlements. But
he is not the only one by any means. There have been a lot of
allegations. That is why it is actually to the benefit of
parliamentarians that we get this, because it enables people to go and
ask the question, ‘Is this an appropriate use of my entitlements or
not?’ and actually to have that sorted by someone who is overseeing it.
So I implore the parliament: corruption is serious. It distorts our
democracy and it hurts communities, communities who end up like those in
the Bentley Blockade, having to take action because governments have
colluded with business to get the outcomes that business wants against
the community. So, come on: let’s get a national ICAC for Australia and
let’s do it in this parliament to restore and maintain our reputation,
and to help build trust in the parliament rather than the level of
cynicism about the revolving door between big business and politics.”
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