To steal a line, there’s something rotten in the state of Victoria. It has a serious problem with corruption, and may find itself ill-equipped to fight it.
This might come as a surprise to Victorians, who have often looked down their noses at the questionable activities taking place elsewhere (for example, in police forces and governments in New South Wales and Queensland). But it is true, and increasingly difficult to deny.
Victoria Police has found members engaged in misconduct of their own volition (disbanding units like the Drug Squad and Armed Offenders Squad for problems ranging from ill discipline to corruption including drug trafficking). More recently, they have admitted large-scale leaks and discovered efforts to infiltrate their ranks and corrupt their officers.
And the Victorian government has not been immune from accusations of improper behaviour, either, as the Baillieu/Napthine Coalition administration has discovered on multiple occasions (see events involving MP Geoff Shaw, or Tristan Weston and Tony Nutt).
To make matters worse, the legislative architecture for investigating corruption in Victoria has serious shortcomings. Aspects of it may even be unconstitutional.
Does Victoria have the institutional wherewithal not just to inspect allegations of minor misconduct, but also to conduct investigations of more grand accusations, such as those levelled at former NSW Labor powerbroker Eddie Obeid? Unanswered questions about the state’s integrity system, along with problems reiterated by the Victorian Ombudsman, give genuine cause for concern.
Debate about integrity reform in Victoria
Since its inception in late 2011, criticism about the legislation that established Victoria’s Independent Broad-based Anti-corruption Commission (IBAC) has been aired publicly on a regular basis from a range of experts. Concerns include the very high evidentiary threshold required for IBAC to conduct investigations, and the fact that IBAC is restricted to investigating “serious” corruption (even though what qualifies as “serious” is not defined).
In late 2012, shortly after penning a letter to then-premier Ted Baillieu, the Ombudsman released a report to Victorian state parliament on the legislation that established the new integrity system. Neither the letter nor the report were optimistic. Part 1 of the Ombudsman’s 2012-13 annual report, tabled in parliament, remains openly critical of the legislation, stating that it is “clumsy and presents operational problems for all concerned”.
The report also warns that the restriction of corruption investigations to “serious” corruption ignores the sorts of cases that create the bulk of the Ombudsman’s more significant work and investigations. The sort of problems with corrupt organisational cultures alleged to be troubling Customs, for example, are a common and substantial problem in when it comes to anti-corruption regimes. However, they would not necessarily be considered “serious” corruption in the context of Victorian legislation. And the problem is more complex than just restricting investigations to serious corruption.
The hole in the system
There is a substantial gap between the kinds of cases that IBAC and the Ombudsman can investigate at will. According to the Independent Broad-based Anti-corruption Commission Amendment (Investigative Functions) Act (2012), IBAC “must not” investigate a case unless it is “reasonably satisfied that the conduct is serious corrupt conduct” (the high evidentiary threshold which experts fear will leave the body open to jurisdictional challenges).
However, the Integrity and Accountability Legislation Amendment Bill (2012) amended the Ombudsman Act (1973) to state that the Ombudsman “must not conduct an own motion investigation into any administrative action that appears to involve corrupt conduct.”
The result is that while IBAC can only investigate cases where there is clear and “serious” corruption, the Ombudsman is now prohibited by law from starting an investigation into anything that bears even a whiff of corruption of any kind. There’s a pretty big gap in between the two.
There is an argument that says this gap isn’t a problem, because IBAC will work as a clearing house for complaints and, once someone refers a matter to IBAC, IBAC can pass it to the Ombudsman, who can investigate matters involving corruption if they are referred to the Ombudsman by IBAC.
While this doesn’t address the fact that there will be many cases of misconduct or corrupt conduct that neither IBAC nor the Ombudsman will be allowed to proactively investigate (a fundamental feature of effective investigative bodies around the world), it at least means that no complaints will fall between the cracks, right? Not exactly.
Time is of the essence
Consider the case of MP Geoff Shaw and the allegations that he used his parliamentary vehicle for commercial use. The Ombudsman received a complaint about Shaw in June 2012, began an investigation and presented a report on the matter in around four months.
On that report’s recommendation, the matter was referred to the Victorian parliament’s Privileges Committee. It’s approaching 11 months since that recommendation and there’s still no finding from the committee, which now has its third chair after its first, Denis Napthine, became premier in March and its second, Andrew McIntosh, resigned his position in April after admitting to “unacceptable” conduct.
Suppose the Ombudsman’s office received a similar complaint today. Before investigating, it would have to first consider whether the matter “appears to involve corrupt conduct” and, if so, refer it to the IBAC. IBAC would then need to consider whether or not the case meets its high evidentiary threshold. If not, IBAC would refer the matter back to the Ombudsman.
So what’s the difference if the Ombudsman ultimately still gets to investigate the complaint? Such investigations often hinge on the extent to which events are still fresh in the minds of parties involved. Delays frustrate the chances of a proper and full investigation, making it less likely a report would compel further action.
Matters that can’t be reported, and the big fish that can get away
The idea of having the Ombudsman investigate matters referred to it by IBAC may be fine in principle, but in practice new restrictions on the Ombudsman’s powers introduced by the proscriptive amendments in late 2012 may create additional problems and frustrate investigation. For example, the Ombudsman is now prohibited from reporting on Cabinet information: this could include cabinet documents and even notes to ministers from advisers.
Similarly, in a parliamentary report released last in May on an investigation into alleged improper conduct by a registrar of the Magistrates’ Court, the Ombudsman notes that such an investigation would be unlikely to be able to be reported (by any of Victoria’s integrity bodies) had the allegations been made under the current legislation. The ability to publicly report on such findings is fundamental to a transparent and effective integrity system.
But forget about Magistrates’ Court registrars and MPs with government cars. Victoria’s watchdogs would be able to tackle really big cases of corruption, wouldn’t they? If an investigation like recently concluded ICAC inquiry into the Obeid saga in NSW were required south of the border, for example? Not according to Stephen Charles, QC, who chaired the Victorian government’s advisory panel on IBAC. He feels the evidentiary requirements and related problems are such that it is unlikely that IBAC would be able to investigate even an allegation as serious as this.
Possible patches, but bigger problems
Small changes could help fill the gap between the kinds of cases each body can investigate, and reduce the prospect of the kinds of jurisdictional challenges that experts are concerned about.
For example, change the wording of the Independent Broad-based Anti-Corruption Commission Act (2011) to state that the body must not commence (rather than conduct) investigation unless reasonably satisfied that serious corruption took place.
In addition, allow the Ombudsman to commence investigations or respond to any and all complaints except when the matter involves serious corruption (rather than prohibiting them from investigating unless they are sure it doesn’t involve serious corruption), with the requirement that if, in the conduct of an investigation, the Ombudsman becomes reasonably satisfied that serious corruption took place, they must then notify IBAC.
This would help avoid delays, allowing the Ombudsman to start investigating in response to complaints while notifying IBAC if and when appropriate, and having IBAC take over if and when it decides that it should do so. This would allow prompt and appropriate commencement of investigation, but would still ensure that matters were ultimately referred to the desired bodies (though it still wouldn’t address the absence of a definition of “serious” corruption, or the challenges in even trying to establish such a definition).
Even if changes like this were made, however, one of the remaining unanswered questions in the Ombudsman’s 2012 report is about a broader problem. That report warned that the restrictions on the independence of the Ombudsman’s office may render sections of the Victoria’s integrity unit unconstitutional (given that the office’s independence is constitutionally enshrined) - a concern which has not since been addressed and which is restated in yesterday’s annual report.
If the constitutionality of sections of this legislation can be challenged, that threatens to compromise the very system it has established.