History repeats: how O'Farrell and Greiner fell foul of ICAC

NSW premier Barry O'Farrell has fallen victim to the state’s ICAC, resigning his post earlier today over a ‘memory fail’ in the evidence he gave before it. AAP/Dan Himbrechts

Today, the New South Wales Independent Commission into Corruption (ICAC) claimed its biggest political scalp in two decades. Liberal state premier Barry O’Farrell resigned after what he has described as a “massive memory fail” in relation to accepting a A$3000 bottle of wine from Nick Di Girolamo, the then-chief executive of the company at the centre of the ICAC investigation, Australia Water Holdings (AWH).

O’Farrell had previously contended in evidence before ICAC that he did not remember receiving the wine. His resignation adds to the raft of misconduct allegations already faced by some members of the NSW Labor Party. After all, how many times in living memory has a premier resigned because of questionable conduct?

Well, twice, if you’re in New South Wales. Before O'Farrell’s demise there was the case of Nick Greiner. In 1989, Greiner championed the establishment of ICAC, only to himself fall victim to it in 1992. At the time of his resignation, Greiner argued it wasn’t corruption, it was “politics”.

The two cases share a number of similarities. The allegations levelled at Greiner were that he misused his position as Liberal Party leader to secure independent MP Terry Metherell’s resignation from state parliament to achieve political advantage. This fits in nicely with the commonly accepted definition of corruption: a misuse of public office for private gain or personal advantage.

It is alleged that AWH lobbied O’Farrell to facilitate the rolling out of water infrastructure with AWH and state-owned Sydney Water Holdings. Lobbying exists within the grey area of corruption. At the very least it creates significant corruption risk.

However, what tipped the balance in O’Farrell’s case was his failure to declare the wine. By not declaring it, the message he sent was that he did not want people to know about it: that it was a personal advantage.

The ‘thankyou note’ which ended the premiership of Barry O'Farrell. AAP/ICAC

Both of these acts rely on individuals achieving gain (be it in the form of Shiraz or political advantage), yet both point to a corrupted political culture. And the increase in public awareness of ICAC’s scope and of the acts that constitute corruption under law means those involved in the AWH case currently before the ICAC (O’Farrell included) have no excuse.

The NSW ICAC is not only the longest running independent anti-corruption organisation in Australia, it is also widely considered to be successful, both in NSW and in Victoria. It has teeth, and it isn’t afraid to bite. Coupled with a comparatively high level of investigations and prosecutions, the powers awarded to the NSW ICAC make it a thorough and well-oiled organisation.

The NSW ICAC relies on the public to report cases of corruption. These allegations, should they prove to be viable or substantiated, are then heard in open hearings. This ensures that the public is engaged with the ICAC which, in turn, promotes awareness of the organisation.

The New South Wales ICAC does not have the ability to charge or sentence individuals who appear before it. Rather, it reviews evidence, makes findings, and then passes it all on to the state Director of Public Prosecutions, who can lay charges over corrupt activity.

Some academics talk about the 20 year life cycle of corruption; that two decades will pass between corruption taking root and corruption scandals being played out. The NSW experience more or less supports this theory.

What needs to be understood, however, is that this 20 year cycle is not a naturally occurring phenomenon. It is about the time it takes for corruption charges to be proved, corrupt cultures disabled and disentangled, and for observers to leave the workforce. As the living memory of institutional corruption lessens, corrupt cultures slowly start to rebuild, and the cycle starts anew.

For the past 20 years, the NSW ICAC has targeted these factors, with varying levels of community support. What is needed is ongoing internal monitoring, and a renewed emphasis on educating office holders as to what is acceptable conduct. You can never entirely get rid of corruption, but you can manage it.