NACC Second Reading Speech

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 The coalition supports the National Anti-Corruption Commission. It was a coalition government that introduced Australia’s first anticorruption commission, over 30 years ago in New South Wales. At the last two elections, the coalition went to the election promising an anticorruption commission. The coalition developed a model for a Commonwealth integrity commission which was subject to a lengthy process of public consultation.

Let me be clear. Corruption is wrong. It’s corrosive of public trust. It undermines the very public confidence on which all our institutions depend. The public should know that those who break the law should face the consequences and that standards in public office should be high.

The passage of bills to establish this commission means that every jurisdiction in Australia will have an anticorruption commission. In participating in this debate, the coalition has sought to draw on the over 30 years of Australian experience of corruption commissions to make sure that this commission is effective and has appropriate safeguards built in. Anticorruption commissions have extraordinary powers to deal with corruption, a civil wrong—more powers than the police have in investigating crimes of murder or terrorism. While we have zero tolerance for corruption, we must also recognise that, such is the opprobrium of being associated with corruption, even being a witness for an anticorruption commission can ruin reputations which have taken a lifetime to build. At the state level, commissions have overstepped their powers. They’ve had findings overturned on appeal. In some cases they’ve been long on shaming and short on successful prosecutions.

The context in which this commission is being established is different to the context under which the ICAC in New South Wales—the first corruption commission—was established. In introducing the ICAC in New South Wales, Premier Nick Greiner noted the events that had led to the establishment of that commission:

In recent years, in New South Wales we have seen: a Minister of the Crown gaoled for bribery; an inquiry into a second, and indeed a third, former Minister for alleged corruption; the former Chief Stipendiary Magistrate gaoled for perverting the course of justice; a former Commissioner of Police in the courts on a criminal charge; the former Deputy Commissioner of Police charged with bribery; a series of investigations and court cases involving judicial figures including a High Court Judge; and a disturbing number of dismissals, retirements and convictions of senior police officers for offences involving corrupt conduct.

Even on the most malevolent view, the situation at the Commonwealth level today is very different to New South Wales in 1988 or the situation which preceded the Fitzgerald inquiry, which led to the establishment of a commission in Queensland.

What is similar is a decline in public confidence in our institutions. The OECD’s latest trust survey in government found that only 51.9 per cent of Australians answered yes to the question, ‘In this country, do you have confidence in the national government?’ Australia is by no means alone in grappling with this decline in trust. Other nations have fared worse: the United States, the United Kingdom, France, Japan, Spain, Italy and Korea. While declining trust in institutions, particularly governments, is a global phenomenon, it’s one we can’t ignore here in Australia. The 2019 Australian election study found that only 59 per cent of Australians are satisfied with how democracy is working. Professor Ian McAllister said: ‘In one of the most worrying findings from our study, a little over one in 10 Australians, or 12 per cent, believe the government is run for all the people. In contrast, more than half, 56 per cent, say government is run for a few big interests.’

Public institutions only work because of trust. As Disraeli said:

All power is a trust; that we are accountable for its exercise; that from the people and for the people all springs, and all must exist.

Anticorruption commissions are not a cure-all for the decline in public confidence in our institutions, but they are seen by the public as a necessary mechanism to hold governments and public officials to account.

Australia is one of the six oldest continuous democracies in the world. The parliament is full of people on all sides with conviction, a willingness to serve and a commitment to the common good—people who disagree in debate but are seeking the best outcomes for our nation. The adversarial nature of this place enables us to hold one other to account in meaningful and important ways, and the processes of the parliament help us improve our lawmaking; question time, Senate estimates and the level of media scrutiny applied to this place are all an important part of that. But we cannot deny that for many in the public there is genuine concern that the mechanisms for accountability built into the procedures and processes of parliament are not enough. The bipartisan support for this bill is a statement to the Australian people and a response to their desire to see another mechanism in place to hold public officials to account.

There has never been a dispute from the side of the House about the importance of integrity. The Labor Party have tried to paint their support for this bill as evidence that they are white knights on integrity, but their actions show this is not the case. In the same week the parliament is debating this bill, it is also debating bills to abolish integrity institutions in the workplace—the Registered Organisations Commission and the Australian Building and Construction Commission. Since coming to government Labor has sought to wind back transparency measures for its three big donors—big unions, big super and big class-action litigation funders. It’s extraordinary to me that the CFMMEU and the ACTU have complained about the same powers in relation to the Australian Building and Construction Commission that the ACTU and the CPSU have supported in relation to the National Anti-Corruption Commission.

Even the process for this bill indicates Labor is no white knight. For nine years we’ve heard the Labor Party lecturing the coalition about the need for proper parliamentary processes and scrutiny in dealing with important bills. So it’s been extraordinary that for this bill, one which deals with integrity, the government is more concerned with meeting an artificial deadline than giving the bill the scrutiny it deserves. Unlike the Commonwealth Integrity Commission, this bill was never subject to an exposure draft process. People making submissions to the committee examining the bill had little more than a week to produce their submissions, and the committee held only four days of public hearings. This was an extraordinarily truncated time line, given the wide-ranging powers given to the commission and the fact that this is such a significant and new institution. It’s been extraordinary to see the cheer squad for this bill both in the parliament and beyond, with organisations one usually associates with more scrutiny and safeguards going along with and supporting rushed processes, less scrutiny and fewer safeguards. The bloodlust among some who should know better has been disappointing.

By contrast, I want to note the very thoughtful submissions and contributions by a range of bodies, particularly: the Law Council of Australia; the Queensland Law Society; the South Australian Bar Association; the Australian Human Rights Commission; the Queensland Council for Civil Liberties; the Victorian inspector; the former National Security Legislation Monitor; Bruce McClintock, who’s been inspector in New South Wales and is now inspector in the Northern Territory; and the Australian Psychological Society. These bodies have analysed the experience of these commissions at the state level and provided helpful and detailed analysis of the bill, despite the absurd time lines the government gave them.

The coalition and organisations arguing for more safeguards do not seek to hamper the work of the NACC but to make it more robust and accountable and to ensure that it’s a body that is beyond reproach. In considering our position on the bill, I’ve met not only former commissioners and advocates for this bill but also people whose lives and careers have been ruined by their appearances at one of the state commissions. I’ve also met people who’ve been bereaved by suicide because of the action of the state commissions. As someone who has been bereaved by suicide myself, I never want to see another Australian family go through that experience, and that’s also influenced my approach to the commission. I want to thank all those people for their work, which has influenced our thinking about the amendments we seek to bring forward.

Let me reiterate: the coalition supports the National Anti-Corruption Commission. The government has the balance right on several matters, but there’s further work to do. We believe that the government’s bill would be improved by adopting the bipartisan recommendations of the joint select committee and by some additional measures that are needed. We intend to bring forward amendments in the consideration-in-detail phase to deal with these measures. Our amendments are designed to implement safeguards to ensure that the bill gets the balance right.

The National Anti-Corruption Commission has a very broad scope. It applies to parliamentarians and their staff and to every Canberra public servant. It also applies to our Defence Force, the Australian Federal Police, our diplomats in embassies around the world and every cook, cleaner, gardener, Comcar driver, contractor or subcontractor the Commonwealth engages with. It applies to almost every person exercising power under a law of the Commonwealth: pharmacists, NDIS workers, aged-care workers and Indigenous rangers. One of my colleagues estimated that probably around a million Australians are brought within the reach of this commission.

But there’s one group of people who are specifically carved out of the application of the commission, and that is union officials exercising a power under a law of the Commonwealth. The carve out for union officials exercising a power under a law of the Commonwealth in sections 12 and 14 undermines the character of the commission as an integrity commission, and we seek to have that carve out removed. The government has been cagey about the carve out. There’s no explanation for it in the explanatory memorandum. When questioned, the Attorney-General’s Department could not give a satisfactory answer on the reasons for the exemptions. When asked on Insiders about the carve out, the Attorney-General initially denied it and then justified it on misleading grounds. Yet Labor has made this provision broad enough to examine anyone who exercises a power under a law of the Commonwealth except unions.

When asked in question time about why the carve out exists for union officials, the Prime Minister first claimed that union officials don’t need to be covered by the anticorruption commission, because they’re covered by the Fair Work Ombudsman and the Fair Work Commission, and this legislation is about plugging gaps, not duplication. But when the shadow minister for defence pointed out that the ADF is also covered by other bodies—namely the ADF Military Code of Conduct and the Inspector-General—and then asked, ‘Why is the ADF included in the National Anti-Corruption Commission but senior union leaders are not?’ Labor completely failed to answer. When asked the following day about the union carve outs, the Prime Minister changed his line and tried again to deny that they exist.

If Labor wants the conduct of Indigenous rangers included as they are in this bill then union officials who abuse their power as granted by a Commonwealth rule should be answerable to this commission. Why can a union official exercise a power under the Work, Health and Safety Act or the Fair Work Act to shut down a worksite for safety reasons and not have to answer for this to this commission, while an NDIS worker may have to answer questions about how they’ve managed their resources and conducted their work? How can Labor claim to have integrity and sweep these sorts of provisions in? How can they ask the Parliament House cleaners to answer to this commission and not the unions?

I’m calling on Labor, the Greens and the crossbench to support our amendments to remove this carve out. An integrity commission with special carve outs for the owner and operator of the Labor Party is no real integrity commission. We’ll be moving amendments to ensure that adequate safeguards are in place to enhance the way the commission operates and to ensure that the rights of individuals are maintained. The commission will have extraordinary powers. With those extraordinary powers should come greater accountability. While it’s important that serious corruption be identified and dealt with, a terrorism suspect prosecuted in a criminal court has more rights than a person brought before the commission. The words of the South Australian Bar Association are particularly worth noting:

Corruption is wrong, but in our zeal to see corrupt public officials dealt with appropriately, we must not discard the protections of the rights and liberties that are central to our legal system.

I want to turn to the issue of public versus private hearings, which has consumed much of the debate about this commission. The default of private hearings is one important aspect of ensuring that the commission’s focus is where it ought to be. The government has struck a good balance with section 73(2), which allows for a hearing to be held in public ‘if exceptional circumstances justify holding the hearing, or the part of the hearing, in public; and it is in the public interest to do so’. This balances the important investigative power of the commission while also protecting the rights of individuals and ensuring that any future prosecutions that may follow from an investigation are not unduly prejudiced. As the Queensland Law Society has said:

In our view, in order to preserve prosecutions, in order to maintain that prosecutorial authority with those bodies, as opposed to investigative bodies, and not unfairly damage reputations of people coming before the NACC, it’s imperative that the default position be that private hearings are held, and obviously with the test of exceptional circumstances being employed.

This aspect of the bill is based on the Victorian provision and strikes a reasonable balance.

We would like to see the test further strengthened. While the legislation presently lists a number of factors in section 73(3) that the commissioner, ‘in deciding whether to hold a hearing, or part of a hearing, in public, the Commissioner may have regard to’, the word ‘may’ is insufficient. We believe the commissioner must have regard to those factors, which include the extent of corruption, the benefits of exposing corrupt conduct to the public and also, importantly, ‘any unfair prejudice to a person’s reputation, privacy, safety or wellbeing that would be likely to be caused if the hearing, or part of the hearing, were to be held in public’.

The need for section 73(3) to be strengthened in this way was endorsed by various submissions to the joint committee, including from the Australian Human Rights Commission, which pointed out:

The factors outlined in 73(3) are all are discretionary. This means that the Commissioner would not be required to take into consideration the impact a public hearing may have on a person’s reputation, privacy, safety or wellbeing. The Commission considers that this should be a mandatory consideration for the Commissioner when deciding whether to hold a hearing, or part of a hearing, in public.

As an additional safeguard, the decision regarding the commencement of a public hearing should not be made by the commissioner alone. I’ve argued elsewhere that public confidence in the commission would be enhanced by having an independent judicial officer exercising powers persona designata to make a determination about whether exceptional circumstances exist and weighing the relevant public interest considerations to hold a public hearing.

The joint committee received evidence that another way of enhancing public confidence in the decision to hold a public hearing would be to have the commissioner determine exceptional circumstances and weigh those public interest factors in conjunction with a deputy commissioner. Dr James Renwick, the former Independent National Security Legislation Monitor, suggested such an amendment would remove:

… not only the risk of, but also the perception of the risk of, personal idiosyncrasy, it shares the heavy burden to be placed on the Commissioner and thereby protects the NACC when such an important decision is made, and it does not detract in any sense from the Commission’s independence.

This measure would align the NACC with the New South Wales ICAC, and we’ll be moving an amendment accordingly.

I want to turn to the definition of corruption. We believe that the definition of corruption needs greater clarity and certainty than the bill currently provides. Sections 8(1)(a) to 8(1)(d) provide a comprehensive list of corrupt conduct, covering breaches of trust, abuse of office, misusing information and conduct that adversely affects the honest and impartial exercise of power and performance of duties. However, section 8(1)(e) then adds that corrupt conduct includes ‘any conduct of a public official in that capacity that constitutes, involves or is engaged in for the purpose of corruption of any other kind’. This clause has drawn significant criticism from a wide range of quarters, including the Scrutiny of Bills Committee. The Law Council of Australia has said that the phrase:

… ‘corruption of any other kind’, as included in the NACC Bill, is undefined and circular … paragraph 8(1)(e) currently has the potential to extend the NACC’s jurisdiction into areas that are not contemplated in the Bill and unknown to Parliament.

The Australian Human Rights Commission has also argued:

Clause 8(1)(e) should be amended or removed, as ‘corruption of any kind’ provides the Commissioner with significant discretion to expand its jurisdiction without parliamentary approval.

The government’s justification for this phrase is the desire to capture what has not been thought of. But this gives the commission the power to determine its own jurisdiction, which is properly a matter for parliament. As Chris Merritt, of the Rule of Law Institute, told the joint committee at a public hearing:

If parliament has difficulty in forming a concise description of what ‘corruption’ is, it should not give unlimited power to the commission to make its own rules.

We will also move amendments to 8(1)(a) to remove the vague and superfluous phrase ‘or that could adversely affect’, consistent with the Law Council’s submission that such a phrase is unnecessary given that conspiracy is included in section 8(10). The phrase ‘or that could adversely affect’ introduces uncertainty to the definition of corrupt conduct.

We are also concerned that section 9(1)(c) does not just define a corruption issue as something that someone has done, or is doing, but as something that a person will engage in in future. This would see the commission investigate possible future conduct that has not actually been carried out. The provision should be removed. A person cannot be investigated and punished for actions they have not taken. We will move amendments to delete section 9(1)(c). Again, this view is consistent with the views of the Queensland Law Society and the Law Council.

Another issue in the public debate about the powers of the commission has been whether it should be able to retrospectively investigate conduct—conduct that has occurred in the past. The basic principle is that people should be able to know what the law is before they act, so they can comply with it. Section 8(4) is also unacceptable, as this gives the legislation completely unbounded retrospective reach. This clause enables the commissioner to investigate conduct that occurred prior to the establishment of the NACC, with no time limit on how far back that action may have occurred. Theoretically, the commission could investigate matters that go right back to Federation. We believe that an additional public interest test is needed if the commission decides to investigate conduct that occurred before the commencement of the National Anti-Corruption Commission act. The Law Council suggested including an additional threshold that will allow the NACC to conduct investigations into past conduct only where there’s an identifiable public interest in doing so. This would bring the NACC into line with similar provisions under the Victorian IBAC Act.

There is a risk that the NACC will be misused as a way of causing harm to an individual through vexatious complaints. This risk is particularly heightened if referrals are publicised, as the simple act of being referred to the NACC could damage the reputation of the person about whom the complaint is made. Dr William Stoltz, policy director at the ANU National Security College, has identified the risk of vexatious complaints being made by foreign actors. As he said to the committee:

… the NACC potentially provides an avenue for malicious actors to mobilise false allegations against our nation’s most senior leaders and elected officials—generally in an attempt to discredit the integrity of our national institutions and to stoke apathy and disillusionment amongst some Australians toward our government.

Greater protections are needed to ensure that vexatious complaints are disincentivised, and that the act of referral to the NACC is not itself a punishment where no misconduct has been established. In order to achieve this, we propose that penalties be applied to making vexatious complaints and also that the publicising of referrals to the NACC be prohibited. Our amendments are based on provisions from the Commonwealth Integrity Commission Bill which the coalition prepared in government.

The Prime Minister has said that this legislation is not designed to duplicate existing processes but, instead, to fill gaps. Under section 45, the commission has the power to reinvestigate matters which have previously been investigated by another integrity agency. Section 45(3) lists matters the commissioner may have regard to when deciding to commence an investigation into a matter previously investigated by a Commonwealth integrity agency. As with the decision to have public hearings, we believe that, in exercising this power, the commissioner and a deputy commissioner should be required to jointly sign off on decisions to reinvestigate matters that have already been considered by another integrity body.

Under this bill, the commission is not required to notify a person who has been the subject of an investigation that that investigation is complete if no finding of corrupt conduct is made against them. This means that a person who has been referred for investigation but has done no wrong could live with the uncertainty and stress of knowing they’re under investigation, but with no closure or end to that stress even when the case has been closed by the commission. Ensuring that people have closure at the end of an investigation is very important for preventing unnecessary psychological distress. Section 159(2) should be amended to mandate the commission to advise a person whether a finding has been made at the conclusion of their investigations.

I now turn to the application of the Administrative Decisions (Judicial Review) Act to this bill. This bill has limited the application of AD(JR) Act to a small number of matters. We believe that judicial review under the AD(JR) Act should be available to all decisions under this bill, and we’ll move amendments to that effect. The streamlined processes under the AD(JR) Act provide an important safeguard for a commission which has such extraordinary powers. Again, this is consistent with recommendations made by the Law Council.

The application of gag orders for people under investigation by the commission can present a real threat to a person’s mental health. Not being able to talk to a mental health professional or a family member can mean that, at a very stressful time, the usual supports a person might rely are not available. As the Australian Psychological Society told the committee:

Individuals involved in corruption commission inquiries are likely to be appearing in a professional capacity … For many people, their professional persona is core to their self-identity and any damage or threat to it is therefore amplified.

Gag orders therefore need to be balanced to ensure that people can access appropriate support. The committee recommended carve-out gag orders for medical professionals and psychologists. Given the shortage of psychologists in Australia, this carve-out should be broader and should also include counsellors. It should also include family members unless they are also the subject of investigation. These additional safeguards are needed due to the stress inherently involved in participating in an Anti-Corruption Commission investigation.

I want to turn briefly to the telecommunications interception surveillance powers. These matters are still being considered by the Parliamentary Joint Committee on Intelligence and Security. While not wanting to pre-empt the PJCIS, we believe that, where warrants are issued under these powers for the purpose of investigating corruption, as opposed to investigating national security or counterterrorism matters, they should be issued by a superior court judge.

I now come to the important issue of privileges. Rule-of-law principles exist for important reasons. They ensure robust systems of justice are balanced with concern for individual rights. This bill abrogates a number of privileges that would exist in a criminal process, like the privilege against self-incrimination and legal professional privilege. Regarding the privilege against self-incrimination, I quote the Law Council, who stated in their submission to the committee:

This principle is enshrined in a statutory context in relation to Court proceedings, however, it is also a fundamental common law right in relation to persons subject to questioning in judicial and other civil proceedings.

They went on to say:

The Law Council has consistently outlined its view that witnesses appearing before any anti-corruption commission should be able to refuse to answer a question or provide information to a Commissioner on the grounds that such information may incriminate the person. To do otherwise would undermine some of the fundamental principles of the criminal justice system …

Because the rights of a person under investigation are waived, it’s very important that material that is elicited by the corruption commission in a scenario under which a person doesn’t have the rights they would usually have in a criminal process must then not be used either directly or derivatively in a criminal process.

The bill also abrogates legal professional privilege, but there are good public policy reasons why a person should be able to consult with their lawyer in confidence. The Law Council has recommended that clause 114 be redrafted to remove the abrogation of legal professional privilege. They also recommend that clause 115 be removed from the bill. We will move amendments in accordance with those recommendations, and we will clarify that the bill does not affect the law relating to legal professional privilege.

A body with the extraordinary powers of this commission must itself be held to account. At present, the inspector’s powers are insufficient. As the bill stands, the inspector is due to be the NACC of the NACC. We believe that the inspector’s role should be broader, and we will move amendments to strengthen the role of the inspector.

We also believe that there should be time limits on investigations, so that the commission is required to conclude investigations within a definite period. I note that one of the foremost advocates for the National Anti-Corruption Commission, Geoffrey Watson SC, has argued for time limits on investigations. Time limits could be extended by application to a court, but we need to see investigations not remaining open indefinitely, and our amendments will seek to do this.

Finally, in relation to amendments, we believe the appointments of the commissioner and inspector must be completely above politics, and, to that end, the appointment of these role should be subject to a supermajority of nine out of 12 members of the joint standing committee. This ensures that those who fulfil these significant roles have bipartisan support, and we will be moving amendments to this effect.

There are several other matters that we believe should be further considered by government. We believe that all those who come before the commission should have their reasonable legal costs met. People are often brought before the commission just to be a witness. The commission may hold investigations with no adverse findings, and a person may have had considerable expense along with the stress of going through that process. Many of the people involved will not be extremely wealthy, and nor will they be likely to qualify for legal aid. For those who are subject to a full investigation, the legal costs could be crippling. We believe that the provision of legal assistance, as outlined in section 282, is too limited, and we believe the government should consider applying a presumption in favour of granting legal assistance to meet the reasonable legal costs of any witness or party, as well as a requirement that hearings do not commence until legal assistance has been approved.

We also believe there is merit in the Attorney developing some model regulator guidelines, along the lines of the model litigant guidelines. These model regulator guidelines could be applied to the NACC to hold it and other Commonwealth regulators to an appropriately high standard of conduct in their engagement with witnesses and persons of interest.

I want to say something about procedural fairness. The commission must always operate with procedural fairness, and in this bill there is an important safeguard, which is that if a finding is made against a person they will have the opportunity to put their case to the commission before the final determination is made. However, there are other measures that are important in providing for fairness for people appearing before the commission. Firstly, people should have an adequate length of time to be able to respond to the findings the commission might plan to make against them. Second, the commission should give people reasonable time to consider documents in advance of hearings. They have been examples in New South Wales of the commission dumping thousands of pages of documents on the morning of a hearing. This is just not acceptable. The government should develop regulations to ensure people have adequate time to participate fairly in the hearings. People should also be able to receive transcripts of evidence they provide and consideration should be given to whether the rules of evidence should apply in public hearings as an additional safeguard.

Finally, if the purpose of the National Anti-Corruption Commission is to change the culture of public administration, one of the most significant things that the commission needs to do, which has been largely neglected, is educate people so that they know what is and what is not corrupt conduct prior to the commission commencing operations. This is very important so that people can identify corruption and prevent it from occurring. Education also gives people an opportunity to pause and reflect on their own conduct and the conduct that they see around them. Cultural change won’t come from hearings or from media stories; it will come from educational seminars, pointing out to people the nature of corrupt conduct and how to limit it. This isn’t about ‘gotcha’ moments; this is about people understanding and behaving according to the standards that the public expects. We will move some amendments in relation to those matters.

In conclusion, while we believe there are numerous measures that would strengthen this body and provide safeguards for individuals, I want to reiterate our support for the National Anti-Corruption Commission. The support for this body across the parliament is a clear message to the Australian people that corruption is wrong and the parliament is dealing with corruption seriously.

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