Fairfax investigative journalists Nick McKenzie and Richard Baker had a small win in a Melbourne court yesterday. Their barrister told the court that a previous ruling agreeing that the magistrate had the right to order the disclosure of their confidential source has been appealed.

The two award-winning reporters with The Age have been fighting a court order to reveal a confidential source since mid-December 2012. Magistrate Phillip Goldberg concluded that with the matter before the Court of Appeal, he could not ask McKenzie and Baker the crucial question: who was the source for your article published on December 8 last year?

McKenzie and Baker have pursued the Note Printing Australia/ Securency story for years in which it is alleged, among other things, that executives used bribes to secure note-printing contracts in Asia. These are powerful allegations that go to the very top of the Reserve Bank of Australia (RBA).

RBA governor, Glenn Stevens, has denied any wrongdoing or cover up of corruption. Some of these executives have now been charged and in their December 8 story McKenzie and Baker claimed that an Indonesian businessman, who allegedly assisted in getting the contracts, has agreed to give evidence against the NPA/Securency executives. The main source in the story was not disclosed.

Good journalists do not grant anonymity to sources lightly, as it lowers the credibility of their story. However, at times a source could potentially be harmed if named and the various ethical codes guiding journalists are very clear. If you have granted anonymity to a source, you never reveal the identity. The reason for this is simple: trust. Sources in possession of controversial information would not speak to reporters if they doubted that the confidentiality agreement would be honoured.

The other main consideration when keeping a source confidential is the public interest in publishing the story. There is little doubt that the alleged corruption and maladministration in the NPA/Securency case is of the utmost public interest.

Unfortunately this case is just one in which various Australian governments have decided to pursue whistleblowers and media “leaks”. The last similar case was that of Michael Harvey and Gerard McManus. The two Herald Sun journalists were informed by a source in the Department of Veterans’ Affairs that the Commonwealth had decided not to increase veterans’ pensions. The then Howard government had decided it was not in the public interest to disclose this. The public servant who provided the information to Harvey and McManus thought differently.

The department decided to find the leak and the two reporters were subpoenaed to disclose their source to a court. They repeatedly refused and were found in contempt of court and fined $7000 each in 2007. To find the whistleblower, the Commonwealth was prepared to cause a bit of collateral damage along the way and “shoot the messengers” – Harvey and McManus.

The case made it clear beyond doubt that the conflict between the ethical codes of journalism and the law (in the guise of contempt of court) was unsustainable. It could be argued that it eroded trust in natural justice. This forced the Commonwealth to start work on the Evidence Amendment (Journalists Privilege) Act 2011, commonly know as shield laws for journalists.

In 2008, a raid on the Sunday Times in Western Australia contributed to a similar law being passed in that state.

Laws providing some level of protection of journalistic sources are now operational in all jurisdictions apart from South Australia, the Northern Territory and Queensland (low-level protection for sources and journalists in Queensland is offered by the Public Interest Disclosure Act, 2010).

Unfortunately for McKenzie and Baker, the Victorian law came into effect on January 1, 2013. It is not retrospective and, hence, does not apply in their case. How effective these laws are remains to be seen. None of them have as yet been put to the test. Critics of the laws have pointed out that they do not reach far enough, as it is up to the proceeding magistrate/judge to decide if the shield law will apply in each individual case. This means the law gives the journalist a right to argue that the law should apply, but it’s not a firm legal right yet.

It could be argued that the shield laws to protect journalistic sources are only addressing the symptom and not the cause for this information bottleneck. The cause can be found in the various criminal codes of the states, territories and the Commonwealth. Section 81 of the Western Australian Criminal Code allowed the raid of the Sunday Times in Perth. It reads:

A person who, without lawful authority, makes an unauthorised disclosure is guilty of a crime and is liable for imprisonment for 3 years.

The equivalent section in the Commonwealth Criminal Code states:

A person who, being a Commonwealth officer, publishes or communicates, except to some person to whom he is authorised to publish or communicate it, any fact or document which comes to his knowledge, or into his possession, by virtue of his office, and which it is his duty not to disclose, shall be guilty of an offence.

The maximum jail term is two years, and these sections apply to any form of information passed on by a public servant.

This is the real reason, in most cases, why journalists are dragged before courts to give up their sources. These sections in our criminal codes are outdated, draconian and not worthy of a mature liberal democracy. No number of whistleblower protection acts or shield laws for journalists can be truly effective as long as these sections remain unchanged.

McKenzie and Baker will appear again in court. Whether they will be asked to reveal their source is still unclear. Perhaps the magistrate will act in the spirit of the new Victorian shield law. Then again, he may not. If so, Australia will have shot another couple of messengers.