Sports rorts are a public service failure, too

Commentary on the now infamous sports rorts saga has concentrated on the actions of ministers and their advisers who brazenly milked the Community Sport Infrastructure Grant Program for electoral advantage.

The role of the Australian Public Service, however, has received less attention, though it is well documented in the Auditor-General's report on the program.

If one of the functions of public servants is to act as a guarantor of administrative integrity - a function that the Prime Minister himself has acknowledged on more than one occasion - the APS certainly failed.

The most fundamental failure was not to clearly inform the minister that she had no firm legal basis for awarding the grants.

Sport Australia, the body chosen by the government to administer the grants, is an independent corporate entity with its own statutory power to award and administer grants. The role of the minister is confined to giving written directions about general policies and practices and the exercise of the commission's powers.

When guidelines for the grant program were being drawn up with Sport Australia and the Department of Health (the portfolio department for Sport Australia), the minister's office insisted that the minister have the right of final approval over individual grants. Sport Australia noted that its act required it to award the grants itself but eventually acquiesced to the minister's demand.

Officials from Health internally raised the possibility of seeking legal advice about using the minister's power of general direction to allow her to take on the awarding role. But this advice was never sought at the time. The program remained in legal limbo, to the full knowledge of senior public servants.

Whether or not the legislation could be interpreted in favour of the minister is beside this particular point.

The key issue is that public servants who fully understood the legal ambiguities wilfully chose to do nothing. When called on to give frank and fearless advice on a question of procedural integrity, they looked the other way.

Such advice might not have altogether constrained the minister and a government hell-bent on buying votes. But it might have given them pause, perhaps encouraging them to bring the scheme within the minister's department and under the more demanding Commonwealth guidelines for the award of grants. At the very least, such advice would have provided a written record of official warning, allowing much sharper personal scrutiny of ministers and their advisers if the scheme's legality were later questioned.

Once the program was under way, Sport Australia was responsible for implementation, attempting to apply the agreed program guidelines within its own generic grant management framework. However, this process became increasingly difficult as the minister's office insisted on its own methods and priorities, operating what the Auditor-General labelled its own "parallel assessment process".

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On a number of occasions, the commission pointed out the risks of having its own recommendations ignored.

In the end, however, it complied with the minister's irregular instructions that were sometimes relayed through the Department of Health.

Arguably, the commission's chair and other officers should have resisted much more forcefully, particularly during the anarchic third round of grants in the run-up to the election, when the minister's office had abandoned all pretence of administrative propriety. As it is, the commission must accept some of the responsibility for what turned out to be a massive failure of governance.

In the wake of the sports rorts fiasco many commentators have called for ministers to be removed altogether from the award of sports and other community grants. Instead, they argue, decisions should rest with genuinely independent authorities, the model that works well for grants in technical areas such as science and medicine.

However, with community grants, there are genuine grounds for supporting the continued involvement of politicians. The argument that locally elected members have a good sense of local priorities, though recently misused by Coalition politicians in an effort to defend the indefensible, is not without merit. Where community need is a major criterion for awarding funds, input from politicians can be valuable.

Moreover, even if politicians are motivated by the desire to win votes in key electorates, this motive in itself is not necessarily to be deplored. After all, democracy depends on harnessing the selfish ambition of politicians for the common good.

If politicians did not see some potential electoral benefit for themselves from community grants schemes, they would be much less keen to allocate funds for all the worthwhile facilities that these grants pay for.

The most workable solution is to allow the politicians to make the final allocations while requiring them to follow rigorous and transparent procedures aimed at reducing the scope for the type of egregious pork-barrelling which characterised the sports rorts.

This approach is enshrined in the Commonwealth rules and guidelines that the sports grants bypassed, and which have now been applied to Sport Australia. The guidelines represent a compromise between the right of ministers to award grants and the need for equity and due process.

Under the rules, ministers must first receive written recommendations from officials before deciding, and must record the reasons for the decision in terms of the program's guidelines.

They may depart from department recommendations, but only if they inform the minister of finance of their reasons for doing so.

Cynics will argue that ministers and their advisers will always find ways to circumvent the framework's intentions. But only if their departmental officials let them.

It would be a sad reflection on the ethical spinelessness of the APS to admit that it is powerless to constrain ministers from corrupting the processes of government.