“The former NSW premier, Gladys Berejiklian, was reported in 2020 as saying that pork barrelling was “not an illegal practice”. The former prime minister of Australia, Scott Morrison, was recently reported as saying, in relation to any federal integrity commission that may be established, that such a body should focus on identifying criminal behaviour rather than subjective questions such as whether spending in respect of marginal seats amounts to pork barrelling. Mr Morrison added, “No one is suggesting anyone has broken any laws, are they?”.
The discussion below answers such suggestions with a clear statement: pork barrelling can indeed amount to a breach of the law, including the criminal law, and in some circumstances, it can also constitute serious corrupt conduct under the ICAC Act.” [NSW ICAC Report On Investigation Into Pork Barrelling In NSW, August 2022]
NSW Independent Commission Against Corruption (ICAC), media release, 1 August 2022:
ICAC finds pork barrelling could be corrupt, recommends grant funding guidelines be subject to statutory regulation
The NSW Independent Commission Against Corruption (ICAC) has found that pork barrelling could constitute corrupt conduct in certain circumstances, while recommending that any whole–of–government guidelines concerning grants funding be issued pursuant to a statutory regulation.
The Commission released its Report on investigation into pork barrelling in NSW (Operation Jersey), today, in which it defines pork barrelling as “the allocation of public funds and resources to targeted electors for partisan political purposes”. In the report, the Commission finds that while individual matters should always be assessed on a case-by-case basis, a minister, for example, may engage in corrupt conduct involving pork barrelling, within the meaning of section 8 of the Independent Commission Against Corruption Act 1988, if the minister:
influences a public servant to exercise decision-making powers vested in the public servant, or to fulfil an official function, such as providing an assessment of the merits of grants, in a dishonest or partial way
applies downward pressure to influence a public servant to exercise decision-making powers vested in the public servant, or to fulfil an official function, such as providing an assessment of the merits of grants, in a manner which knowingly involves the public servant in a breach of public trust
conducts a merit-based grants scheme in such a way as to dishonestly favour political and private advantage over merit, undermining public confidence in public administration, and benefiting political donors and/or family members
deliberately exercises a power to approve grants in a manner that favours family members, party donors or party interests in electorates, contrary to the guidelines of a grant program which state that the grants are to be made on merit according to criteria
exercises a power to make grants in favour of marginal electorates, when this is contrary to the purpose for which the power was given.
The report notes that those who exercise public or official powers in a manner inconsistent with the public purpose for which the powers were conferred betray public trust and so misconduct themselves. The Commission also finds that pork barrelling could satisfy section 9 of the ICAC Act. It may do so, for example, by conduct amounting to a substantial breach of the Ministerial Code of Conduct, or the Members’ Code of Conduct, or conduct constituting or involving the common law offence of misconduct in public office.
The Commission notes that in issuing this report, it intends to make it clear that ministers and their advisers “do not have an unfettered discretion to distribute public funds. The exercise of ministerial discretion is subject to the rule of law, which ensures that it must accord with public trust and accountability principles.”
Altogether, the Commission makes 21 recommendations to help prevent or better regulate pork barrelling. These also include that:
the Government Sector Finance Act 2018 be amended to mirror section 71 of the Commonwealth Public Governance, Performance and Accountability Act 2013 by including obligations that a minister must not approve expenditure of money unless satisfied that the expenditure would be an efficient, effective, economical and ethical use of the money and that the expenditure represents value for money
the grant funding framework, or equivalent requirements, apply to the local government sector. This should include situations where local councils are both grantees and grantors
clause 6 of the Ministerial Code of Conduct be amended to read, “A Minister, in the exercise or performance of their official functions, must not act dishonestly, must act in the public interest, and must not act improperly for their private benefit or for the private benefit of any other person”.
The Commission’s report follows an investigation it commenced in May 2020 into the NSW Government’s Stronger Community’s Fund. Following an inquiry by the NSW Legislative Council’s Public Accountability Committee, a performance audit by the NSW Auditor-General, an assessment by the State Archives and Records Authority and a review into grants administration in NSW (led by the Department of Premier and Cabinet in partnership with the NSW Productivity Commissioner), the Commission revised its investigation scope. It determined that it was in the public interest to examine and report on the circumstances where, it had concluded, pork barrelling could involve serious breaches of public trust and conduct that could amount to corrupt conduct.
To assist its investigation, the Commission engaged a number of experts to prepare papers and participate in a public forum held on 3 June 2022. The report represents the view of the Commission but draws on the analysis of these experts. The report is available on the Commission’s website.
_____ENDS_____
In which it is revealed just how much wiggle room there is left to the Perrottet Government that would allow it to proceed with business-as-usual pork barrelling if it continues to support Recommendation 2 in the April 2022 Review of grants administration in NSW: Final Report. As well as its lukewarm "in principal" support for the creation of law to hold members of parliament accountable.....
Excerpts from NSW ICAC Report On Investigation Into Pork Barrelling In NSW, August 2022 which include parts of the transcript of the NSW ICAC Forum on Pork Barrelling held 3 June 2022:
At Page 6:
Also in 2020, the NSW Auditor-General announced a performance audit of the SCF, and the Public Accountability Committee (PAC) of the NSW Legislative Council established an inquiry into NSW grant programs (including the SCF). The reports issued by the Auditor-General (in February 2022) and the PAC (in March 2021 and February 2022) made numerous observations about the management of the SCF, including adverse findings. The State Archives and Records Authority (SARA) also released a report in January 2021, dealing with recordkeeping aspects of the SCF.
In November 2021, Premier the Hon Dominic Perrottet MP announced a review of grants administration in NSW. Given the existing findings and review processes concerning the SCF, the Commission decided that it was not in the public interest to continue investigative action that could have led to adverse findings against any individual. Consequently, the scope of the Commission’s investigation was revised to focus on the practice of pork barrelling more broadly and, in particular, whether it could allow, encourage or cause corrupt conduct (chapter 1).
At Page 78:
Now, in November 2021 the new Premier Dominic Perrottet stated that “Taxpayers expect the distribution of public funds will be fair and I share that expectation,” he said. He ordered a review of how grants should be administered and this was a very good sign that something might actually be done to prevent the recurrence of such abuses in the spending of public money. Now, that report was published quite recently in April. Some of its recommendations are very good, such as the creation of a new guide on grants management to better ensure documentation and critically transparency.
So that’s the first step that needs to be taken. In my view I don’t think it goes far enough. First, the obligations on ministers and their staff in relation to grants need to be imposed by law, not just in a premier’s memorandum and was proposed in that report. And this is because other accountability provisions in codes of conduct and statutes such as the ICAC Act turn on whether there has been breach of a law, not a premier’s memorandum, a law. So for example if a minister has behaved in a partial manner and his or her behaviour would cause a reasonable person to believe that it would bring the integrity of the office or parliament itself into serious disrepute, a finding of corrupt conduct can be made by ICAC if the minister’s acts also constitute breach of a law, not a premier’s memorandum, a law. [my yellow highlighting]
Similarly, clause 5 of the Ministerial Code of Conduct requires a minister not to direct or request a public service agency to act contrary to a law. Burying grants rules in a memorandum rather than in a law avoids consequences for ministers if they breach those rules or if they instruct others to do so. Another problem is the failure to address the issue of grants being made for the advantage of a political party including when they are election promises. Now, at the Commonwealth level the use of ad hoc noncompetitive grants to give effect to election promises has resulted in rules about merit and proper assessments being tossed out the window.
Any new state grant rules should explicitly provide that grants must only be allocated in the public interest and not predominantly for party political purposes. New grants rules should also contain express provisions to prevent avoidance and to ensure that election promises must still be subject to proper scrutiny and merit assessment.
At Page 128:
The second thing is that I think that we’ve got to recognise that at a Commonwealth level those statutory or the rules that have the force of law, you know, are crucial. I think we should remember that in the sports rorts affair, the main recommendation of the Australian National Audit Office there in relation to that was to bring those grants within those guidelines, and ministerial decision-making about grants within those guidelines. It was recommendation 4 and the government accepted it on the spot. So it’s a bit like saying, yep, actually we’re a bit scared now but we’re going to accept that recommendation. So actually to say that nothing was done is not accurate because, in fact, the system was pushed in the right direction. But I think the key problem is those mechanisms for transparency around when ministers decide to deviate from their official advice, making those mechanisms real so that there’s a real deterrent to poor or partisan decision making. Because we have the problem of corruption in plain sight. There’s plenty of people, I suspect that John Barilaro might have been one of them, who would say, “Yeah, we’ll just do it openly. We’ll just say, yeah, these are the reasons,” and, you know, and dare anybody to tell us that this is not in the public interest. So we’ve actually got, that’s got to work in a way that actually can be a realistic disincentive to make poor decisions while not stopping the ability to make good decisions. That’s quite a complex thing to get right at the end of the day in politics, I think.
The third thing is that the – and I would absolutely agree with what Joe just said, I think that goes to the problems maybe in the report and the problems with the codes of conduct at the moment, is this focus on public versus private. They have to more actively and explicitly deal with what we’re talking about here, that it’s not a contest between public duty and private personal gain, that it’s something more complicated than that and that the guidance on that in codes of conduct that are then properly enforced is as crucial as anything else, because it’s one of the few ways that we’ve got to actually support good decision-making culture amongst politicians and actually influence their understanding of what they’re doing. Otherwise it just turns into Whac-A-Mole, you know, what they’re currently getting away with over here they will just try and get away with over there because they believe that they’re doing the right thing. We’ve got to create a framework where it’s more clearly understood why this is not the right thing. So that’s number three. Number four is, I would go back to the electoral bribery offence and actually recast the electoral bribery offences to make it clear that pork barrelling can be electoral bribery, which is currently not, it’s currently written in the other direction so that it’s actually a clear warning in criminal law where it needs to be. You don’t need to be an expert in public trust and misconduct in public office to say giving people money to influence how they vote, or how that immediate community votes, is actually problematic in criminal law directly.
At Page 173:
Allegations of pork-barrelling have also occurred at the State level. In recent times, they have been directed at sports grants, arts grants and bushfire relief funds, amongst other funding programs.
In November 2020, the then Premier, Gladys Berejiklian, admitted that the payment of grants to local councils from the Stronger Communities Fund in the period prior to the previous election amounted to pork-barrelling, but claimed it was ‘not an illegal practice’. The Premier also later justified ‘throwing money at seats to keep them’, arguing that this was part of ‘democracy’. In response to questions about why grants were made contrary to the advice of public servants she observed that Departments were not expert at ‘winning byelections’.
It seems, however, politicians are not expert at it either and that pork-barrelling is not terribly effective, despite the strong, but misguided, belief of politicians that they can use public money to buy electoral success.
