The flimsy case for a federal anti-corruption watchdog
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The flimsy case for a federal anti-corruption watchdog

The idea of a Commonwealth ICAC has long tended to be a policy in search of evidence.

Denmark, New Zealand, Finland, Sweden, Switzerland, Norway, Netherlands, Canada, Germany, Luxembourg and Britain. What two characteristics do these countries have in common?

First, all now rank above Australia on Transparency International's latest corruptions perceptions index. Second, none has the equivalent of a federal independent commission against corruption. Indeed, of those ranked more highly than Australia, only Singapore, an authoritarian city-state, has an anti-corruption agency.

These facts will probably surprise most people following the public conversation about political corruption in Australia. Here, public debate assumes that if corruption is a problem in the Commonwealth government, a federal ICAC must be the solution. Those who question the need for an ICAC must be questioning whether corruption is a serious issue. The possibility that corruption could be a problem best dealt with by other measures or that Australia has anything to learn from other, less apparently corrupt democracies rarely gets a hearing. In Australia, we already know the answer: if corruption is serious, then we must have an ICAC.

This assumption was on full display in the media during the dog days of January. Fairfax Media reported findings from the Public Service Commission that nearly 5000 public servants had witnessed corruption in their organisations, mainly instances of cronyism and nepotism. The percentage who reported corruption (5 per cent) had nearly doubled compared with a survey three year earlier (2.6 per cent), though the commission pointed out that definitions had changed between the two surveys and the percentages were not strictly comparable. As was to be expected, the media report then concluded with references to two expert groups, the Centre for Policy Development and Transparency International, both calling for a federal ICAC. The Canberra Times later editorialised that the case for a federal ICAC grew "stronger by the day".

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A federal ICAC is probably now unstoppable.

A federal ICAC is probably now unstoppable.

Photo: Paul Jones

A few days later, the media reported on the publication of "research" by The Australia Institute purporting to show that perceived corruption might have wiped $72 billion from the Australian economy during the past four years. The analysis was built on a general correlation between GDP per capita and Transparency International ranking, which yielded an average difference of $480 GDP per capita for every place in the rankings. On this basis, Australia's slide from seventh to 13th place between 2012 and 2016 had caused the economy to lose $72 billion.

The argument is so full of holes as to be laughable. Averages are only averages and do not apply in all cases. Correlations are not causes. Australia's decline in the rankings is partly due to comparative improvement in some other countries as much as to absolute deterioration in our own performance. Besides, as the analysis admits, the transparency rankings are based on perceptions only.

Still, the $72 billion figure was enough to get a punchy headline from gullible journalists. Moreover, it provided a good lead-in to the main point: the need for a federal anti-corruption body. Again, the connection was simply asserted without argument. Corruption is a massively costly problem, therefore a federal ICAC must be the solution.

The Australia Institute's research director and report co-author, Rod Campbell, was quizzed on this point by Crikey. Asked how a federal ICAC would help reduce corruption in a tangible sense, he talked in general terms about restoring trust in our institutions. He also drew on a recent media report on Labor MP Michael Danby's past misuse of travel expenses, saying a federal ICAC might discourage people like Danby from taking taxpayer-funded trips to the Gold Coast (a function now filled, incidentally, by the Independent Parliamentary Expenses Authority). Asked further about possible examples of that happening in other countries, Campbell could only reply he was "not fully across what other countries have as their anti-corruption infrastructure". So much for a "research-based" case for a federal ICAC!

ACT Greens MLAs Caroline Le Couteur and Shane Rattenbury with Labor's Andrew Barr and Yvette Berry. Anti-corruption agencies tend to work better in smaller jurisdictions, which bodes well for the ACT's pending body.

ACT Greens MLAs Caroline Le Couteur and Shane Rattenbury with Labor's Andrew Barr and Yvette Berry. Anti-corruption agencies tend to work better in smaller jurisdictions, which bodes well for the ACT's pending body.

Photo: Jay Cronan

That a federal ICAC has come to dominate the anti-corruption agenda is a remarkable example of policy capture, steadily gaining ground over almost a decade. The Greens have spearheaded the campaign, beginning with Bob Brown's private member's bill in 2010 to establish a national integrity commission. Adam Bandt reintroduced the bill two years later and Christine Milne a year after that. With neither of the major parties (nor the federal bureaucracy) showing any enthusiasm, the proposal for an anti-corruption agency became a distinguishing marker for the Greens, along with marriage equality and support for renewable energy. Whenever a politician or a public servant was caught behaving unethically, the Greens leader of the day could always be counted on to say that this underlined the case for an anti-corruption agency.

Influential advocacy for a federal ICAC has also come from several former judges and senior barristers, including those with direct experience in the NSW and Queensland anti-corruption commissions. Keen to see their state-based successes repeated on a larger stage, they have argued forcefully against Commonwealth exceptionalism, pointing out that human frailties are not confined to members of state and territory government. Under their leadership, support for a federal ICAC has spread throughout the more liberal and reform-minded members of the legal profession. It is now a settled conviction in progressive political thinking.

A federal anti-corruption agency has all along tended to be a policy in search of evidence. Support for an agency comes first, appealing to a vague unease about the ethical state of government. Who could not be against corruption and in favour an agency devoted to that purpose? Any further confirmation of declining confidence in government, such as the latest Transparency International rankings, is adduced as supporting evidence. At the same time, all individual instances of impropriety, ranging from rorting of outsourcing contracts, through lucrative post-ministerial appointments to dual citizenship of parliamentarians (or dredged-up news about Danby) become grist to the same mill.

A more rational approach to anti-corruption would be to begin by identifying the main types of corruption that threaten the federal government's integrity. For instance, with politicians, the major problems surround the funding of political parties, purchase of access to ministers and post-ministerial appointments. With public servants, the ethical pressure points are appointments and procurement, and the influence of cronyism and nepotism. Once the problems are clearer, attention can then turn to remedies and assessing the accumulated international experience of how best to combat various types of corruption. Can one agency effectively deal with all such issues? How do other, reportedly less corrupt democracies, handle them? These questions are worth asking but are being ignored in the rush to a single, all-embracing anti-corruption agency.

The views of Australia's top scholar on political corruption, Professor Adam Graycar, have been marginalised in public debate.

One local expert following a more nuanced line has been Professor Adam Graycar, Australia's top international scholar on political corruption. He has argued for years that the case for a federal anti-corruption agency is weak because no one has yet clearly specified the problems it is designed to solve (and, by implication, the problems it won't solve). Given this lack of clarity, Graycar sees serious difficulties ahead in defining the powers of a federal ICAC and managing inter-agency conflict. He supports a more networked solution, involving a small coordinating agency and building on existing institutions. But his views have been marginalised in public debate.

Similarly, Prime Minister Malcolm Turnbull has recently advocated a more open-minded approach, saying in a pre-Christmas interview that the policy objective is zero-tolerance of corruption, an objective he takes "very seriously". He has been considering the recent Senate select committee report on a national integrity agency "very carefully". If there are "gaps in our armoury", they will need to be remedied "in the best way". But we need to get it right because "the experience has been mixed". He is reportedly unconvinced about the need for a federal anti-corruption agency.

Typically, however, journalists framed this interview solely in terms of the campaign for a federal ICAC. "Turnbull considers anti-corruption body" read one headline, while the text emphasised this was the first time Turnbull had been prepared to consider the possibility of such an agency. With all other political parties now in favour of the policy, the Coalition remained "the final obstacle".

A federal ICAC is probably now unstoppable. Turnbull may say he looking at all options, but is likely to roll over and agree, if only to avoid what interest groups and the media have turned into an unwinnable argument. In this case, those concerned about corruption in the federal government must hope that any agency established has the right balance of investigative powers and accountability. It will also need to cooperate with, rather than try to absorb, other existing integrity agencies, at least in the short term.

Properly designed and resourced, a federal ICAC has the potential to do some good. But it will not be the cure-all for government corruption that its advocates claim. Other critical issues will still need attention – for example, legislation relating to election expenses and party donations, whistleblower protection, and conflict-of-interest procedures for both ministers and public servants.

Meanwhile, the Greens are already tasting success in the ACT; Canberrans are about to embrace their own local anti-corruption agency, as the Greens' price for continuing to support the Barr Labor government. Here, there are good grounds for being more confident about the agency's likely value. International experience suggests that, among countries with robust legal systems and professional government bureaucracies, it is the smaller jurisdictions that have had most recourse to anti-corruption agencies. At a national level, Singapore and Hong Kong, the only countries in Transparency International's top 15 to have such an agency, are the standout exemplars. They have been joined by state or provincial governments in other top-15 countries, not only NSW and other Australian states but also Quebec in Canada. Reasons for this tendency must remain speculative but could include factors such as the smaller size and more informal scale of government agencies in smaller jurisdictions, leading to less robust internal systems of control, less well-resourced external accountability agencies and lesser levels of media scrutiny.

Certainly, when the ACT and federal governments are compared, the greater intimacy of the ACT and the particularly cosy personal relations between politicians, business and unions offer fertile ground for cronyism and nepotism. Moreover, the unwillingness of ACT voters to throw out the incumbent Labor government, however much they may dislike its behaviour, allows ministers to escape effective accountability.

The Legislative Assembly committee tasked with designing an anti-corruption and integrity commission sensibly overrode pleas from ACT Policing seeking to be excluded and from unions opposing public hearings. It has produced a workable model with significant powers that could prove beneficial in helping to keep both politicians and public servants on their toes and out of each other's pockets. At the same time, the small size of existing integrity agencies should tend to keep turf disputes at manageable levels.

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Regardless of differences of scale, however, we can be sure that any success enjoyed by an ACT commission will be eagerly snapped up by the federal ICAC lobby as yet more evidence in support of its cause.

Richard Mulgan is an emeritus professor at the Australian National University's Crawford school of public policy. richard.mulgan@anu.edu.au

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