By Christopher Knaus, originally published on the 25th of March 2021.
A former New South Wales anti-corruption commissioner has slammed the state government’s plan to cut $14m from five key integrity agencies, describing it as “alarming”.
Responses to budget estimates on Wednesday showed the Independent Commission Against Corruption (Icac) and the NSW ombudsman both face cuts of $3.4m, while the Law Enforcement Commission will be cut by $3.3m.
The NSW electoral commission will take a hit of $4.4m, and the audit office faces a $373,000 cut.
Icac’s chief commissioner, Peter Hall, has already warned that funding cuts threaten to have an “immediate and serious” effect on the agency’s ability to fight corruption.
In recent years, Icac’s work has uncovered damning examples of integrity failings on both sides of politics. It revealed the alleged cover up of $100,000 in unlawful donations from property developer Huang Xiangmo to Labor, and uncovered the property dealings of the Wagga Wagga MP Daryl Maguire while he was in office and in a relationship with the premier, Gladys Berejiklian.
Hall has also previously warned that Icac’s funding must be taken out of the hands of state government, saying the current arrangements allow those who are investigated by the agency to control its purse strings.
“If the commission’s funding under the persuasion or influence of the executive of government, or for any other reason is reduced or constrained, that of course would inflict considerable damage to the commission’s ability to function,” he said in 2019.
“While it may brighten the day of perpetrators of corrupt conduct to know that, it would be a sad day indeed for our community.”
That view has been endorsed by both an audit report and a Liberal and National party-dominated parliamentary committee, which both warned the current funding model threatened its independence.
The government, though, has not overhauled the funding model. Instead, it appears to be persisting with cuts, via efficiency dividends and cost savings, to the Icac.
The department of premier and cabinet said there were no new efficiency dividends applied to the integrity agencies this financial year, and said the savings applied last year had “already been factored into integrity agency budgets”.
“Over the previous 10 years, funding has been increased dramatically for integrity agencies,” the department said in a statement. “For example, ICAC’s recurrent expense budget has gone from $19.8m in 2011, to a recurrent expense budget of $30.9m in 2021. In addition to this, integrity agencies can request supplementary funding at any point.”
The department said Icac had received supplementary funding every time it applied for it during at least the last eight years.
Anthony Whealy, a former Icac assistant commissioner and current chair of the Centre for Public Integrity, said the news was alarming and would “clearly affect frontline workers for Icac”.
“This means in practical terms that its ability to investigate properly serious allegations of corruption will be diminished,” he told the Guardian.
“It is reported that Icac has submitted a business plan to the government. Perhaps, in that situation, there is some hope that yesterday’s statement is not the final word.”
But Whealy said the more fundamental problem was Icac’s independence. He said it must not be treated as a usual government agency, and should be funded in a way that guaranteed independence.Advertisement
“There is an overwhelming case to permit Icac’s budget to be determined by an independent body and not by bureaucratic oversight,” he said.
“Icac’s work is too important to be diminished by cuts of this kind. Perception is everything. Here, the perception is that the government wants to weaken the watchdog, precisely at a time when it should be strengthening it.”
Last year, the NSW auditor general said the role of cabinet in signing off on funding allocations threatened the independence of integrity agencies.
“The current approach to determining annual funding for the integrity agencies presents threats to their independent status,” the auditor general, Margaret Crawford, wrote in her report into integrity agency financing.
The office of the special minister of state, Don Harwin, was approached for comment.