Government Senator Eric Abetz has suggested the sports grants saga could go all the way to the High Court, as arguments continue over whether former sports minister Bridget McKenzie had the legal right to make decisions about who received funding.
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On Tuesday, emeritus professor in law at Adelaide and formerly the Australian National University Geoffrey Lindell said he had explored the law from every angle and could find nothing that legalised Senator McKenzie's decisions. He suggested she could even be legally liable herself to repay the money.
If the $100 million in projects had been illegally funded, the grants should be ratified to make them legal, and former sports minister Bridget McKenzie should be held responsible with, at least, a parliamentary censure, he said.
Senator Abetz asked whether it was fair to censure a minister if she had acted in good faith, believing she had the legal authority.
To which Professor Lindell responded, "If, in fact, we're not going to hold the minister responsible, something will have to be done about the authority of people employed in minister's offices. These people are assuming more and more authority ... We can't just leave it as a vacuum. Someone has to be responsible for what happens in the minister's office."
His comment follows a call from David Thodey in his review of the public service last year for a code of conduct covering ministerial staffers, whose numbers and power have swelled in recent years.
In his report on the sports grants, Auditor-General Grant Hehir said he could find no legal authority for Senator McKenzie to make the grants decisions, given Sport Australia was a statutory authority, at arm's length from the government. He also reported that legal doubts had been raised internally in 2018 when the grant guidelines were being developed but no one had sought advice.
Prime Minister Scott Morrison says Mr Hehir is wrong. He says Attorney-General Christian Porter consulted the government solicitor and "considers that the Auditor-General's assumption [is] not correct". Mr Morrison hasn't released any advice on the point.
Sport Australia also recently sought legal advice from an "eminent Queen's Counsel" and told a Senate inquiry that the grants had been legal. The advice and the name of the queen's counsel has not been released.
But Professor Geoffrey Lindell said he could find no legal authority.
"There does not appear to be any power to authorise a minister, or ministerial staff, either to make the actual grant or determine to whom the Sports Commission should award the grant," he told a Senate inquiry into the grants.
"Neither does there appear in the Act any authority for the Sports Commission to delegate either of those functions to a minister or his/her ministerial staff."
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Professor Lindell said his comments about the minister lacking authority "applies equally and perhaps ever more strongly to a mere official in the minister's office or in the prime minister's office or indeed the prime minister himself. The cloud hangs over all of them, because we go back to the starting point - the commission is the legally appointed decision maker."
The government has made much of the program guidelines which specify that the minister is the final decision maker. But Professor Lindell said it had searched in good faith for "the legal authority for that statement and I've yet to find it".
Senator Abetz said one of the questions was the "constitutionality" of the funding.
"A number of legal academics have made comments on all of that and we will be interested if it does finally go to the High Court as to what they may find," he said.
Professor Lindell said it was not trivial and the consequences were far-reaching. The grants might be invalid. The money might be recoverable from clubs.
If the commission was found not to have acted in good faith - because it didn't seek its own legal advice - it could be sued.
Senator McKenzie herself might have acted illegally by not satisfying herself that she had the legal authority to make decisions. And she might even have left herself open to attempts to recover the money from her personally. For this, she would have to be guilty of "misconduct or by a deliberate or serious disregard of reasonable standards of care."
"The personal liability to repay what is sure to be a vast amount of money seems quite drastic but, on the other hand, one counter consideration is that the failure of the Parliament to provide a criminal or civil penalty for breaching s71 of the Act may otherwise fail to deter Ministers from the conduct prescribed by the same section," he told the inquiry.
Senator Abetz suggested various defences for Senator McKenzie, including that Sport Australia had believed she was entitled to make the decisions, the sports grants were announced as a separate program in the budget, and there was no evidence that legal doubts were raised with her. But Professor Lindell rejected the suggestions, saying it was up to the minister to satisfy herself that what she was doing was legal.