Achieving Integrity in Victoria

In brief

Restoration of the role of the Parliament
Parliament must be restored to its rightful place as Victoria’s supreme integrity institution. This can be achieved by:

• • • INDEPENDENT FUNDING
    • REFORMING PARLIAMENTARY OVERSIGHT COMMITTEE RULES TO PREVENT EXECUTIVE DOMINANCE
    • ENSURING THAT THE AVAILABILITY OF SCRUTINY MECHANISMS DOES NOT DEPEND UPON GOVERNMENT COMPLIANCE WITH PROCEDURAL REQUIREMENTS
    • FACILITATING ACCESS TO DOCUMENTS BY THE LEGISLATIVE COUNCIL
    • REVITALISING THE LEGISLATIVE ASSEMBLY BY PROVIDING FOR GENERAL NON-GOVERNMENT BUSINESS AND INCREASED USE OF THE CONSIDERATION-IN-DETAIL PROCESS

Protection of the role of oversight agencies  
Victoria’s oversight agencies must be independent, and resourced and empowered to fulfil their mandates. This can be achieved by:

• • • INDEPENDENT FUNDING
    • BROADENING IBAC’S JURISDICTION TO CAPTURE NON-CRIMINAL CORRUPT CONDUCT
    • EMPOWERING IBAC TO HOLD PUBLIC HEARINGS WHENEVER IT IS IN THE PUBLIC INTEREST
    • REMOVING THE ‘REASONABLE GROUNDS’ THRESHOLD TO IBAC BEGINNING AN INVESTIGATION

Promotion of transparency
The publication of ministerial diaries and enhanced lobbying regulation would promote transparency in relation to the exercise of public power. This can be achieved by:

• • • REQUIRING PUBLICATION OF MINISTERIAL AND STAFFER DIARIES
    • ENHANCING LOBBYING REGULATION
    • RELEASE OF CABINET DOCUMENTS AFTER 30 DAYS
    • ESTABLISHING STRONGER CONFLICT OF INTEREST PROCEDURES

Promotion of accountability
Parliamentarians must be accountable for the way in which they exercise public power. This can be achieved by:

• • • ESTABLISHING A PARLIAMENTARY ETHICS COMMITTEE
    • ESTABLISHING A PARLIAMENTARY INTEGRITY COMMISSIONER
    • STRENGTHENING CODES OF CONDUCT

Promotion of political equality
Political equality must be promoted by levelling the playing field. This can be achieved by:

• • • IMPLEMENTING ELECTORAL EXPENDITURE CAPS
    • ABOLISHING THE ‘NOMINATED ENTITY’ EXEMPTION UNDER THE ELECTORAL ACT 2002 (VIC)
    • BROADENING THE DEFINITION OF ‘GIFT’

 

In full

Restoration of the role of the Parliament
Parliament must be restored to its rightful place as Victoria’s supreme integrity institution. This can be achieved by:

INDEPENDENT FUNDING

In Victoria, the executive funds the Parliament. This is in conflict with the principle of responsible government, upon which our democracy depends. The Parliament should be funded independently of the executive, via the same Independent Funding Tribunal model we propose in relation to the funding of other accountability institutions (see below).

REFORMING PARLIAMENTARY OVERSIGHT COMMITTEE RULES TO PREVENT EXECUTIVE DOMINANCE

Oversight committees

Under the Parliamentary Committees Act 2003 (Vic), important oversight functions are conferred on joint investigatory committees of the Victorian Parliament. The composition of these committees is critically important to their ability to fulfil their functions.

Currently, the only oversight Committee of the Victorian Parliament which is not dominated or chaired by the executive is the Pandemic Declaration Accountability and Oversight Committee. The fact that this Committee is composed of only 50 per cent of government members and chaired by a non-government member is a consequence of amendments made to the Parliamentary Committees Act 2003 (Vic) as part of the negotiations to pass the Public Health and Wellbeing Amendment (Pandemic Management) Bill 2021. Pursuant to those amendments, no more than half of the members of the Pandemic Declaration Accountability and Oversight Committee can be drawn from the a party forming the Government, and the chairperson must be a non-government member ( ss 21A(5) and 22(1A) of the Parliamentary Committees Act 2003 (Vic)).

With the Pandemic Declaration Accountability and Oversight Committee an exemplar since its establishment, it is clear that Victoria’s other joint investigatory committees would benefit from the broader application of the composition rules preventing executive domination. The weakness of executive-dominated parliamentary committees can be seen, for example, in the actions of the Scrutiny of Acts and Regulations Committee (SARC) in its review of the Public Health and Wellbeing Amendment (State of Emergency Extension and Other Matters) Act 2020 (Vic). In its review report, the SARC explained that it had not undertaken any review of public health directions as they not been laid before Parliament, and therefore its powers to review the instruments under s 25A(1)(c) of the Subordinate Legislation Act 1994 (Vic) (SLA) had not been enlivened. In respect of whether directions under the Public Health and Wellbeing Act 2008 (Vic) were legislative instruments for the purposes of the SLA, the Committee stated:

The Committee expresses no view as to whether the Directions ultimately may be characterised as either legislative or administrative instruments. Ultimately, ‘responsibility for decisions about statutory rules and legislative instruments lies with the responsible Minister’.

The Committee failed to express a view on the status of the Directions in spite of there being compelling reasons for treating them as legislative instruments, and this meant that the Directions received no real parliamentary scrutiny.

Privileges committees
Both the Legislative Assembly and the Legislative Council have a Privileges Committee, whose role it is to enquire into and report on breaches of parliamentary privilege. The composition rules relating to both Houses privileges committees’ must also be reformed in order to reduce the House majorities’ ability to dominate.

ENSURING THAT THE AVAILABILITY OF SCRUTINY MECHANISMS DOES NOT DEPEND UPON GOVERNMENT COMPLIANCE WITH PROCEDURAL REQUIREMENTS

The weakness of Victoria’s parliamentary scrutiny system was exposed by the COVID-19 response throughout 2020 and 2021. Up until 22 December 2020, when the Government amended the Subordinate Legislation (Legislative Instruments) Regulations 2011, there was a compelling argument that the state’s public health directions constituted legislative instruments for the purposes of the SLA, and should therefore enliven that Act’s scrutiny provisions (including the jurisdiction of the Scrutiny of Acts and Regulations Committee). However, because the executive failed to table the Directions in Parliament, the Committee’s powers to review the instruments under s 25A(1)(c) of the SLA were not enlivened.

This experience exposed the potential for scrutiny mechanisms to be avoided by government failure to comply with procedural requirements (although we note that such a failure to comply can be reported upon by the SARC to the Parliament under s 16B(3) of the SLA). The dependence of scrutiny mechanisms upon such compliance undermines their potential to be effective, and should be urgently remedied. One precedent for reform can be found in the jurisdiction of the Pandemic Declaration Accountability and Oversight Committee, which – as a consequence of amendments made to the Public Health and Wellbeing Amendment (Pandemic Management) Bill 2021 – is not expressed to be dependent upon government compliance with any matter (s 165AS of the Public Health and Wellbeing Act 2008 (Vic)).

FACILITATING ACCESS TO DOCUMENTS BY THE LEGISLATIVE COUNCIL

The Legislative Council’s power to make an order for the production of documents is critical to its ability to fulfil its scrutiny function.

In response to a Legislative Council order for production, the government is able to claim executive privilege (Standing Order 11.03). Should a dispute arise in relation to such a claim, provision is made for the appointment of an independent arbiter to determine the claim (Standing Orders 11.04 and 11.05). However, the involvement of such an arbiter depends upon executive compliance with the requirement of Standing Order 11.03(1) to provide to the Clerk documents in relation to which privilege is claimed, with the consequence that if the executive refuses to provide the documents, this oversight mechanism is effectively avoided.

Considering that no government in the history of Victoria has ever complied with this mechanism, it is time to legislate a mechanism for resolution.

REVITALISING THE LEGISLATIVE ASSEMBLY BY PROVIDING FOR GENERAL NON-GOVERNMENT BUSINESS AND INCREASED USE OF THE CONSIDERATION-IN-DETAIL PROCESS

There is currently no provision for general non-government business in the Legislative Assembly, limiting the ability of non-government members to fulfil their representative function. This is a grave deficiency of the Legislative Assembly’s Standing Orders, and an opportunity for non-government
members to engage in a more meaningful way in the Assembly must be reinstated as a matter of priority.

The consideration-in-detail process, which allows for the detailed consideration of bills by members, is significantly underused in the Assembly and consideration should be given to the circumstances in which this important stage of the legislative process can be skipped.

Protection of the role of oversight agencies
Victoria’s oversight agencies must be independent, and resourced and empowered to fulfil their mandates. This can be achieved by:

INDEPENDENT FUNDING

The contradiction inherent in the executive controlling the funding of agencies which scrutinise it is self-evident. To avoid Victoria’s watchdogs being vulnerable to cuts for biting the hand that feeds them, and to ensure that they can not only be independent but be seen to be independent, executive control of the funding of the IBAC, the Ombudsman and the Auditor-General must be removed.

The adoption of a model via which funding is allocated by an appropriately qualified and designed Independent Funding Tribunal would be an important step towards the achievement of this objective. Design principles for such a Tribunal include the following:

• • • Tribunal members should be nominated by a non executive-dominated parliamentary committee, with a requirement for bipartisan support modelled on the nomination process for Queensland’s Crime and Corruption Commission (that is, either support of the members of the parliamentary committee unanimously, or support of a majority of the members other than a majority consisting wholly of members in the political party or parties in government)
    • The Tribunal must have sufficient powers to inquire into and determine the annual departmental appropriations for each agency in relation to which it has jurisdiction
    • The Tribunal must consider draft estimates prepared by agencies as part of the inquiry process; should it make a determination that is inconsistent with what is requested in the draft estimates, it must provide written reasons
    • Funding determinations must include triennial baseline funding that increases annually in line with CPI
    • Funding determinations must be reviewed annually to determine whether circumstances necessitate supplementation (for example, following expanded jurisdiction)
    • Tribunal inquiry reports and determinations must be made public in order to enhance transparency

BROADENING IBAC’S JURISDICTION TO CAPTURE NON-CRIMINAL CORRUPT CONDUCT

Section 4 of the Independent Broad-based Anti-corruption Commission Act 2011 (Vic) (IBAC Act) enumerates the kinds of conduct that constitute corrupt conduct. However, any relevant conduct is only capable of being corrupt conduct under the Act if it also constitutes a relevant offence (s 4 (1) (a)). Relevant offence is defined at s 3 of the Act to mean an indictable offence under an Act, as
well as the following common law offences: attempt to pervert the course of justice, bribery of a public official, perverting the course of justice, and misconduct in public office.

This contrasts with the approach taken in New South Wales, where a disciplinary offence, reasonable grounds for terminating a public official’s appointment, and substantial breaches of an applicable code of conduct by a Minister or member of parliament are sufficient to attract the ICAC’s jurisdiction (so long as such conduct meets the definition of ‘corrupt conduct’ at s 8 of the Independent Commission Against Corruption Act 1988 (NSW)).

Broadening the kinds of conduct which enliven the IBAC’s jurisdiction would ensure that the Commission’s work is not unduly limited to cases where the constituent elements of a limited set of offences, which do not capture all forms of corruption, are present.

EMPOWERING IBAC TO HOLD PUBLIC HEARINGS WHENEVER IT IS IN THE PUBLIC INTEREST

Section 117(1)(a) of the IBAC Act prohibits the holding of public hearings unless the IBAC considers, on reasonable grounds, that – amongst other things – ‘exceptional circumstances’ exist.

This requirement exposes the Commission’s decision to hold a public hearing to legal challenge. Such challenges can be mounted by well-resourced litigants to both delay Commission investigations and obtain knowledge of the material that the Commission has against them, allowing them to potentially seek to interfere with evidence. The spectre of these risks may mean that the Commission is less likely to hold a public hearing, even in cases where the threshold would be met.

In seeking to understand the value of public hearings in practice, the Centre for Public Integrity invited current and former integrity Commissioners from various commissions around the country to participate in a survey. Respondents were universally of the view that an exceptional circumstances threshold for public hearings is inappropriate. The Hon John McKechnie KC, Commissioner of the West Australian Corruption and Commission, pointed out that ‘It is hard to think of exceptional circumstances. This is traditionally used as a legislative brake on the exercise of power and seems unnecessary’. One former Commissioner, who wished to remain anonymous, articulated the difficulty that an undefined term like ‘exceptional circumstances’ presents: ‘the concern one always will have, is important matters that deserve expedition getting bogged down in the courts over such imprecise language’. The Commissioner described these court challenges as ‘very distracting, and therefore [they] can only serve to detract from the important work of integrity agencies by diverting their focus and resources into defending ones that are more often than not ill founded when centred around the meaning and application of vague, and […] unnecessarily restrictive, legislative language’. The Commissioner also noted that the protraction of investigations as a consequence of court challenges is undesirable from a witness welfare perspective: ‘the longer investigations take, the more stressed and likely to suffer psychological harm key witnesses and persons of interest become’.

REMOVING THE ‘REASONABLE GROUNDS’ THRESHOLD TO IBAC BEGINNING AN INVESTIGATION

Under s 60(2) of the IBAC Act, the IBAC cannot conduct an investigation in accordance with its corrupt conduct investigative functions unless it suspects on reasonable grounds that the conduct constitutes corrupt conduct.

This effectively operates as a significant limitation on the Commission’s vitally important work: frequently, when integrity commissions receive allegations, they have insufficient information to determine whether there would be reasonable grounds to suspect that the conduct constitutes corrupt conduct. Determining this question is precisely the purpose of an investigation, and it should not operate as a precondition to the use of investigative powers.

A further difficulty with this requirement is that it exposes the IBAC’s decision to commence an Investigation to legal challenge. Such challenges can be exploited by well-resourced litigants to both delay IBAC investigations and gain knowledge of the material that IBAC has against them.

Promotion of transparency
The publication of ministerial diaries and enhanced lobbying regulation would promote transparency in relation to the exercise of public power. This can be
achieved by:

REQUIRING PUBLICATION OF MINISTERIAL AND STAFFER DIARIES

Unlike Queensland, New South Wales and the ACT, Victoria does not currently require the
publication of ministerial diaries. Ministerial and staffer diaries are an invaluable accountability
mechanism: they help the public to understand who has access to Ministers, and the issues of
interest to those who have that access. Considering that ministerial and staffer salaries are paid for
by public funds, it is difficult to conceive of any rational basis for refusing their publication.

ENHANCING LOBBYING REGULATION

The Victorian lobbying regime is substantially deficient, insofar as it consists only of a Code of Conduct which is not fit for purpose.

The Victorian Government Professional Lobbyist Code of Conduct does not create an appropriately broad definition of lobbying, or apply to all those engaging in lobbying activity. A further weakness of the Code is its prohibition on former public office holders taking up lobbying work: this prohibition is too short to be meaningful, with parliamentary secretaries, executives and ministerial officers banned for 12 months, and ministers and cabinet secretaries banned for 18 months. In addition, the only penalty lobbyists face for non-compliance in Victoria is deregistration – in comparison, more robust regimes (such as those in New South Wales, Queensland, South Australia, Western Australia, the UK and Canada) also provide for fines, and some (Queensland, South Australia, Canada and the UK) also provide for criminal prosecution.

The Victorian lobbying regime could be strengthened by:

• • • Defining ‘lobbying activity’ sufficiently broadly to capture any contact with government representatives relating to government or parliamentary functions
    • Capturing all persons engaged in ‘lobbying activity’ (rather than only third-party lobbyists)
    • Broadening the definition of ‘government representative’ to capture all those who may be the subject of lobbying activity (including parliamentarians and staffers)
    • Enhancing disclosure of lobbying activity, via:
      • the monthly publication of ministerial and staffer diaries (see above)
      • electorate officers being required to maintain auditable records of contact relating to lobbying activity
      • a publicly accessible lobbying register disclosing lobbyist contact with government representatives
      • a requirement that parliamentarians seeking contact with a minister or staffer disclose relevant interests and lobbying
    • Prohibiting lobbyists from being able to access parliamentarians whom they have supported
      directly or indirectly
    • Enshrining the Lobbying Code of Conduct in legislation
    • Amending the Ministerial Staff Code of Conduct and Electorate Officers Code of Conduct to require staffers and electorate officers to comply with lobbying regulation 
    • Instituting a cooling off period that is of sufficiently long duration (at least 2 years) to allow for the dilution of influence and networks
    • Establishing a lobbying regulator with the powers and resources to perform ongoing oversight of the regime and enforce meaningful sanctions
    • Providing training for government representatives on the risks that lobbying can present

RELEASE OF CABINET DOCUMENTS AFTER 30 DAYS

In Victoria, cabinet documents are only released after 10 years. Victoria should follow the gold- standard example set by Queensland and publish cabinet documents after 30 days, as part of fostering a pro-disclosure culture which would improve the transparency and scrutiny of government decision-making.

ESTABLISHING STRONGER CONFLICT OF INTEREST PROCEDURES

There must be a review of conflict-of-interest controls for ministers and staffers, with relevant Codes of Conduct being amended accordingly.