Pearls and Irritations

In my blog of April 19 2014, ‘This is about more than a bottle of wine’ I referred to the need for major reforms in lobbying. 

Three and a half years ago the ICAC in NSW brought forward proposals to better manage lobbying and avoid corruption. The Recommendations of the ICAC are still relevant today. If action had been taken at the end of 2010 we could have avoided many of the problems that have arisen in NSW. The ICAC report follows.

John Menadue

ICAC recommends legislative changes to better manage lobbying

Wednesday 10 November 2010

The Independent Commission Against Corruption (ICAC) recommends a new lobbying regulatory scheme for NSW that would require greater transparency of lobbying activity through new legal requirements for lobbyists to be registered, and for the occurrence of meetings and other communications between lobbyists and government representatives to be recorded and made publicly available.

In its report, Investigation into corruption risks involved in lobbying, released today, the Commission recommends that the NSW Government enacts legislation to regulate lobbyists, including the establishment and management of a new Lobbyists Register. The ICAC also recommends that the new scheme includes a prohibition of payment to, or receipt by, lobbyists of “success fees” contingent on the achievement of a particular outcome or decision arising from a lobbying activity.

The Commission found that a lack of transparency in the current lobbying regulatory system in NSW is a major corruption risk, and contributes significantly to public distrust. “Those who lobby may be entitled to private communications with the people that they lobby, but they are not entitled to secret communications,” the report says. “The public is entitled to know that lobbying is occurring, to ascertain who is involved and, in the absence of any overriding public interest against disclosure, to know what occurred during the lobbying activity.”

The ICAC recommends that the NSW Premier develops a model policy and procedure for adoption by all departments, agencies and ministerial offices concerning the conduct of meetings with lobbyists, the making of records of these meetings, and the making of records of telephone conversations. The Commission also recommends that the NSW Government amends the definition of “open access information” in the Government Information (Public Access) Act 2009 to include records of lobbying activities for which there is no overriding public interest against disclosure.

Other recommendations include that:

• the NSW Government develops a new code of conduct for lobbyists, which sets out mandatory standards of conduct and procedures to be observed when contacting a government representative, based on the current NSW Government Lobbyist Code of Conduct, and containing a clear statement prohibiting a lobbyist or a lobbyist’s client from offering, promising or giving any gift or benefit to a government representative that has been, is being, or is likely to be lobbied by the lobbyist
• consistent with the Australian Government lobbying Code of Conduct, restrictions be imposed on former ministers, parliamentary secretaries, their staff and senior government officers from acting as lobbyists for a prescribed period
• all third party lobbyists (those that undertake lobbying activity for a client in return for payment or the promise of payment) and lobbying entities (an organisation that engages in a lobbying activity on its own behalf) be required to register before they can lobby any government representative and that they disclose on the register the month and year in which they engaged in the lobbying activity, the identity of the government department, agency or minister lobbied, and the name of any senior government representative lobbied
• an independent government entity maintains and monitors the Lobbyists Register, and that sanctions be imposed on third party lobbyists and lobbying entities for failure to comply with entry requirements.

The Commission does not consider that lobbying at local government level should be subject to the same regulatory regime as lobbying at the NSW State Government level due to the differing nature of lobbying at each level; at state level, problems are about the perceptions and corruption risks arising from closed door lobbying and from the lack of available information about lobbying, while at local level the problem is about contact between an applicant and a council officer which can lead to corruption or the perception of corruption.

Hence, in relation to local government lobbying, the Commission’s recommendations include that:

• the NSW Government amends the Model Code of Conduct for Local Councils, or otherwise introduces a protocol, to regulate contact between council staff and applicants for development proposals (including those acting for applicants)
• the NSW Government amends procedures for the making of applications to councils that require approval or determination to include provision for a declaration by applicants of affiliation with any council officers
• sanctions should apply to applicants who submit a false declaration.

As part of this investigation, which was the first major corruption prevention-based investigation undertaken by the ICAC in many years, the Commission held a public inquiry over 11 days in August 2010 at which the Commissioner, the Hon David Ipp AO QC, presided. Forty-eight witnesses from various sectors including lobbyists, members of parliament, the media and the public sector voluntarily appeared and gave evidence.

The public inquiry followed the release of an issues paper in May this year, which was widely disseminated and prompted submissions in response to the 26 issues raised in the paper in relation to lobbying.

The Commission will write to the Premier and other relevant parties to communicate the recommendations.

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