Victoria's liquor and gaming regulator spent hundreds of thousands of taxpayer dollars to secretly investigate its own inspectors after they challenged decisions to go soft on bar and club owners in breach of their licences.
Documents obtained by The Sunday Age reveal the Victorian Commission for Gambling and Liquor Regulation monitored the email communications, mobile phone data and movements of several liquor licensing inspectors last year before standing them down.
The monitoring was authorised by acting VCGLR chief executive Catherine Myers, who last year was acting director of compliance.
In a big embarrassment to the VCGLR, an independent report ordered by the Public Service Standards Commissioner into the commission's handling of the inquiry into its inspectors found serious flaws, unsubstantiated allegations and a denial of ''procedural fairness''.
Several of the inspectors targeted by the internal probe had raised bullying concerns about a senior manager and were named in court documents as willing to support a former colleague's workplace safety claim against the state government.
The Sunday Age last week revealed how three former inspectors alleged in affidavits lodged in the Federal Court that they conducted bogus inspections of nightclubs and bars in order to meet the government's performance targets. The Department of Justice refutes those allegations and will defend the former inspector's claim in court.
The independent report by the former head of the Kennett government employment relations commission, Susan Zeitz, found that of the six inspectors initially suspended last year by the VCGLR, two were the subject of long-running probes into allegations of falsifying government records and inappropriate use of email to undermine superiors.
The Sunday Age has confirmed the two inspectors targeted most heavily by the investigation had clashed with their superiors after their decisions to lodge infringement notices against a St Kilda nightclub for not having working CCTV and a Fitzroy club for overcrowding were overturned.
After months of investigation, VCGLR chairman Bruce Thompson last November deemed that both inspectors had breached the Victorian public service code of conduct and ordered they be counselled on appropriate use of email.
But Ms Zeitz's report has found the VCGLR's investigation to be so flawed and lacking in evidence that Mr Thompson's findings should be revoked and the allegations against the men classed as unsubstantiated.
One inspector accepted a redundancy package while the other has returned to his VCGLR job.
The investigations cost taxpayers hundreds of thousands of dollars, with Deloitte paid $82,475 to monitor emails and investigate the inspectors. Private investigators from the Asia Pacific Security Group received nearly $50,000, documents released under freedom-of-information laws show.
The government has not disclosed payments to law firm Landers & Rogers over the investigation. It also paid the wages of the six inspectors during the period of their suspensions, which in some cases lasted for several months. The amount of time senior departmental officers spent on the matter also cost taxpayers.
Ms Zeitz found that the VCGLR changed its evidentiary basis for both alleged breaches of the code of conduct as time went on because the available information did not support the initial charges.
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