Why we need strong ethical standards for ministers – and better ways of enforcing them

Prime Minister Scott Morrison has asked his department to probe whether Bridget McKenzie was in breach of ministerial standards in her handling of the sports grants program.
Mick Tsikas/AAP

Howard Whitton, University of Canberra

Prime Minister Scott Morrison has asked the head of his department to investigate whether Bridget McKenzie violated ministerial standards when she dispensed sports grants to clubs in marginal seats and those being targeted by the Coalition in last year’s election.

It is generally accepted by Australians that “public office is a public trust”. The nature and extent of that trust, however, is continuously being debated.

This is especially true in an age of virtually unlimited potential for scrutiny of governments, and unlimited scope for the court of public opinion to take submissions (and make judgements) about ministerial conduct – well-founded or otherwise.

The late (and much lamented) John Clarke once told me his main role as satirist-in-residence to the nation was to remind the Australian people how fragile their democratic institutions are.

Almost a decade later, we are told on good authority that a significant proportion of young Australians do not trust “government”, to the point where many might well prefer military rule.

This is one reason why codified and enforceable standards of ministerial ethics and conduct will remain relevant – and expected – in our country.

Early steps toward enacting standards

Australia hasn’t always had a set of ethical standards for ministers and government officials. It is a relatively recent phenomenon which came about during Prime Minister John Howard’s time in office in the 1990s.

The idea was first broached in 1978 when Prime Minister Malcolm Fraser commissioned Nigel Bowen to conduct a review of conflict of interest matters involving officials.

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Instead of regulation, however, the committee sought to rely on the “court of public opinion” to deter unseemly conduct by MPs.

In the next few years, the culture of government in Australia began changing radically, and quickly.

When the Fraser government introduced both the Administrative Decisions (Judicial Review) Act and the Freedom of Information Act, the opportunities for public scrutiny of ministerial decision-making – and conduct more generally – significantly affected public expectations about the way “the business of government” was done.

At a stroke, new standards of conduct by decision-makers at all levels were needed for the first time, for a new era of accountability and “speaking truth to power”.

Standards put forth by Howard and Faulkner

While the Hawke Labor government chose not to bring in new ministerial standards in 1983, Howard did so in 1996 – 20 years after Bowen.

After Howard introduced his ministerial code of conduct, a significant number of ministers were forced to resign over various conflict of interest matters, and the code was amended to be less onerous.


Probe into minister’s grant to gun club

Prime Minister Scott Morrison has asked the nation’s top bureaucrat to review whether embattled Nationals deputy leader Bridget McKenzie breached ministerial standards by approving a $36,000 grant to a shooting club of which she was a member.

The so-called sports rorts saga also threatens to drag Nationals leader Michael McCormack into the controversy as it emerged his son’s country football club in the NSW Riverina received a $147,000 grant under the program.

Support is rapidly eroding for the Agriculture Minister within federal government ranks, with Nationals MPs now canvassing whether the Victorian senator can survive in her role as the grants program that she administered threatens to engulf the Coalition.

It was also revealed last night that Senator McKenzie had admitted she was a member of the Wangaratta Clay Target Club in a press conference to local media at the time she approved a grant in

February last year, and had made a decision to fund the club under the $100 million Community Sport Infrastructure grants program after personally viewing the facilities.

A statement from Mr Morrison’s office last night said the Prime Minister had referred the revelations from the Herald story and a damning Auditor-General’s report to the Secretary of the Department of Prime Minister and Cabinet, Phil Gaetjens.

‘‘The Prime Minister is awaiting the secretary’s advice and will continue to follow due process. The matters raised in the media today have also been referred,’’ the statement said.

The Auditor-General’s report last week slammed Senator McKenzie over her handling of the $100 million program, revealing that she and her staff had intervened hundreds of times to overturn the merit-based assessments of applications from sporting groups for cash.

Mr McCormack strongly supported his deputy yesterday and rejected suggestions the program had been manipulated to fund his son’s football club, Mangoplah-Cookardinia United Eastlakes Football and Netball Club, in December 2018. At the time Mr McCormack’s son, Alex, was the club treasurer.

Mr McCormack told the Herald neither he nor his son had any involvement in the club’s decision to apply or its application for funding under the program.

‘‘Upon learning the MCUE Club had lodged an application, I alerted Senator McKenzie verbally about my family connection to the club and recused myself from any comment, advocacy or otherwise in relation to this application,’’ he said.

Senator McKenzie has refused to reveal whether she declared her potential conflict or recused herself from discussions to fund the Wangaratta shooting club.

In a video of her press conference on the day she announced the funding, the Nationals deputy leader said she had joined the club ‘‘a couple of weeks ago’’.

The footage from the press conference in February last year casts doubt on Senator McKenzie’s claims that funding decisions on the grant program were already under way and that the membership was ‘‘a gift’’.

‘‘When the club came to me when I joined up as its member a couple of weeks ago and showed me the facilities and amenities that this club had, I knew it was something that our government had to support,’’ Senator McKenzie said at the time.

Club secretary Linda Motha said yesterday she had ‘‘nothing to say’’ on the issue.

Labor leader Anthony Albanese said the revelations that the senator had overseen funding to a shooting club of which she was a member ‘‘fails every test’’ and she had to resign.

‘‘This is just red hot. This is just a rort. It fails the pub test. It fails every test,’’ he told Adelaide radio station FIVEaa. ‘‘If Scott Morrison doesn’t take action here, this goes to fundamental integrity and faith in politics.’’

A handful of Senator McKenzie’s Nationals colleagues, who declined to speak on the record, told the Herald it was ‘‘doubtful’’ whether she could continue in the job.

‘‘No one wants to see her discarded but it is getting beyond embarrassing now. She should stand aside,’’ one MP said.

Attorney-General Christian Porter, who has been tasked with working out the legality of Senator McKenzie’s grant approvals, said the process had been within the guidelines.

“What I fundamentally don’t accept is that ministers should not be involved in final approval for projects. That’s their job,” he told 6PR Perth radio.

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Against this backdrop, Opposition Senator John Faulkner introduced draft ethics and integrity standards to the Labor shadow cabinet. It was adopted as party policy in 2001.

The Faulkner standards, which I co-authored with George Thompson on Faulkner’s staff, drew on public ethics principles, legal definitions and community norms regarding the integrity expected of public officials.

The standards introduced by John Faulkner have been endorsed by every government since 2007.
Alan Porritt/AAP

The standards recognised several challenges for parliament in policing its own members, chiefly that parliament had not enacted a code of conduct itself and had recently passed laws prohibiting it from expelling an MP for misconduct.

It therefore became the responsibility of the prime minister to enforce the standards.

The Rudd government endorsed these standards of ministerial ethics when it came into power in 2007. And each prime minister since then has endorsed a version of the standards, largely unchanged.

Challenges of enforcing standards

Every version of the standards has reminded ministers of their ethical and fiduciary duty to respect the trust placed in them by the public, and maintain public trust in parliament and our system of government.

Yet, challenges remain when it comes to interpreting and enforcing the standards. Notably, the standards impose a “waiting period” for former ministers and their staff to take up certain forms of employment after leaving office.

Yet, no government has sought to introduce statutory bans on specific jobs for former officials. There is also a lack of specific information about what forms of employment conduct are, and are not, permissible.

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This lack of specifics emerged as a notable problem in the recent cases involving Christopher Pyne, Julie Bishop and Andrew Robb after they took up new roles that raised questions after leaving office.

There were similar problems in earlier cases involving former Labor ministers who left office. This requires immediate remedy.

In the two decades since the Howard code, new ways of thinking about integrity in public office – and ministerial conduct, in particular – have also emerged.

The common law offence of “misconduct in public office” has become extensively used in North America in cases involving unethical and prohibited conduct by government officials, such as abuse of office, bribe-taking, vote-buying, unlawful lobbying and conflicts of interest.

There has also been a major revival in the prosecution of this offence in the UK, Hong Kong and Australia in recent years, generally for corruption cases.

The offence now ranks as the charge of choice for anti-corruption investigators and prosecutors in a host of jurisdictions, yet it has been the subject of relatively little academic research or recent commentary.

Personal responsibility for conduct

But ethics standards can only do so much – MPs and former ministers, in particular, must also take responsibility for their own conduct, irrespective of any formal sanctions which might apply.

It is always the minister’s personal responsibility to uphold the letter and the spirit of the oath of office, because of what that oath represents.

As former US Senator Alan Simpson once said:

If you have integrity, nothing else matters. And if you don’t have integrity, nothing else matters.

Howard Whitton, Visiting Fellow, University of Canberra

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Quantitative Easing

Morrisons magic band

Community or self interest?

The auditor general released a scathing report on the program, finding it had a distributional bias in favour of marginal seats and suggesting the then sports minister may have lacked legal authority to approve grants.

The prime minister boasted the program ‘isn’t about sport’ but ‘community’ while unveiling one $200,000 grant

Treasurer Josh Frydenberg is an honorary member of a tennis club that received a grant from the sport program. Coalition MPs Ken Wyatt and Sarah Henderson also have links to sport clubs that received grants.

More than $1m in sport grants was handed to nine clubs that boast senior Coalition MPs as members or patrons, including one undisclosed by Bridget McKenzie, three linked to Indigenous affairs minister Ken Wyatt, one tied to treasurer and deputy Liberal leader Josh Frydenberg, and two associated with senator Sarah Henderson.

The controversial $100m grant program gave money to a gun club joined by the former sports minister, a tennis club where Frydenberg is an honorary member, an Australian rules football club where Wyatt is the “No 1 ticket holder”, and Henderson’s football and netball club, which made personal representations for the funding to prime minister Scott Morrison.

The memberships are listed in MPs’ register of interests as affiliations where “a conflict of interest with a member’s public duties could foreseeably arise or be seen to arise” – with the exception of the Wangaratta Clay Target Club which received $35,980 but was not listed on McKenzie’s register of interests.

The club received funding to install new toilets and amenities. It boasted McKenzie had “signed up to our club as a full fee-paying member” when she visited the club on 25 January 2019 to announce funding alongside Nationals candidate Mark Byatt who was contesting the independent-held seat of Indi.

A spokeswoman for McKenzie told The Age that since the membership was a “gift” in January 2019 and valued at less than $300 a declaration to the Senate was “unnecessary”.

Most other MPs told Guardian Australia they did no more than alert clubs in their area to the grants on offer, although Henderson wrote a letter of support in favour of one successful club.

The revelation follows a week of bad press about the community sports infrastructure grant program, sparked by a scathing auditor-general’s report which found the program conducted under McKenzie, the former sports minister, skewed the grants towards marginal seats.

Wyatt was the patron of three clubs that received funding: Kalamunda Districts Rugby Union Club ($180,000); Swan Districts Football Club ($199,616); and the Guildford & Kalamunda Districts Swimming Club ($24,195).

Video shows Wyatt handing over a giant $180,000 cheque for new women’s changing rooms to the Kalamunda Districts Rugby Union Club on May 5, just two weeks before the federal election. The club is in his marginal electorate of Hasluck in Western Australia.

The two grants to the Swan Districts Football Club – for $31,516 and $168,100 – paid for a new women’s changeroom and to upgrade the sound system at its home ground.

Wyatt has not only declared himself a patron of the club, but told parliament he was the club’s “no. 1 ticket holder”.

The club is located in the neighbouring electorate of Perth, also a marginal seat, which was retained by Labor’s Patrick Gorman, who is also a supporter.

Chief executive Jeff Dennis said he did not see any conflict of interest.

“We firmly believe both grants were successful based on the merit of the application,” Dennis told the Guardian.

“We don’t see any conflict of interest with either Ken Wyatt or Patrick Gorman. Both support the club because we deliver many broad and deep community outreach strategies.”

In January 2019 Wyatt posted photos to social media handing a large-sized $24,000 cheque to the Guildford & Kalamunda Districts Swimming Club to purchase new pool covers.

Henderson declared that for part of 2019 she was a member of the Barwon Heads Football and Netball Club and a sponsor of the Grovedale Tigers Football and Netball Club, both of which have now lapsed. Both are in Henderson’s former marginal seat of Corangamite.

According to Sports Australia Barwon Heads got $370,000 in the first round of the program for new lighting at its home ground and Grovedale got $256,000 in the third round.

The Barwon Heads grant was awarded after prime minister Scott Morrison, Henderson, and the club’s president Tim Goddard were pictured together in October 2018. The club made personal representations to Morrison and Henderson about the need for new lighting and other facility upgrades, according to its Facebook page.

Henderson told Guardian Australia she had backed clubs and organisations “without fear or favour”.

“Of the nine Corangamite clubs and one Corio club for which I was asked to, and provided, a letter of support, only two were successful: Barwon Heads Football and Netball Club in Corangamite ($370,000) and Geelong Soccer and Sports Club in Corio ($500,000),” she said.

“Like many MPs, I sponsored many major sporting clubs across my electorate.

“Of five applicant clubs in Corangamite which I sponsored, two were successful and three were unsuccessful in obtaining funding.”

Liberal MP Julian Leeser disclosed that he is a patron of the Eastwood-Thornleigh District Tennis Association, which received $184,000 in the second round.

Liberal MP Jason Falinski declared he is a patron of the Bayview Golf Club, which got $140,372 in the third round of the program.

In July Frydenberg declared to parliament that he is an honorary member of the Grace Park Tennis Club, part of the Grace Park Hawthorn Club which received $25,000 in the third round of the program. Frydenberg also held his official function for the 2019 election night at the club.

Frydenberg, Falinski and Leeser said their offices had sent general alerts to sports clubs in their electorates about the grant program but clubs applied independently.

Frydenberg said “local sports clubs were notified of the program but no representations were made [on their behalf]”.

Falinski said he “made no personal representations for grants – I don’t believe I’ve ever spoken to Bridget McKenzie [about the program]”.

“The first I knew about the [Bayview Golf Club] application is when I was told they had been successful.”

A spokeswoman for Leeser said in December 2018 McKenzie visited his electorate to discuss mobile phone reception and Leeser took her to see a number of sports clubs including the Eastwood-Thornleigh District Tennis Association and some others who had applied for a grant.

The auditor general’s report found that 70% of projects approved by McKenzie in the second round in March 2019 were not recommended by Sport Australia, rising to 73% in the third round in April 2019 after an extra $40m was tipped into the program.

Morrison, McKenzie and Frydenberg have all defended the program, arguing all projects were eligible for grants and no rules were broken in the allocation of funding.

Nevertheless, the attorney general is now reviewing legal issues that could render the grants invalid, including the auditor general’s finding that McKenzie lacked authority to approve grants and the program may be unconstitutional.

Morrison has suggested that after cabinet approved the program his office’s role was limited to relaying on representations made by his MPs, with McKenzie making the final decision on grants.

Guardian Australia contacted Wyatt for comment.

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