Government Integrity and an ICAC

May 9, 2022
Prime Minister Scott Morrison

There is a legislated process prescribing how government grants should be administered, but it clearly is not being followed and  we need an integrity commission to enforce it.

An important issue for many voters in this election – particularly the Teal Independents – is government integrity and the need to establish a national integrity commission with teeth.

Labor is supporting this initiative, but the stumbling block is opposition from the Prime Minister, Scott Morrison.

According to Morrison, members of parliament are accountable to voters and should be able to allocate funding for community grants and infrastructure without undue fear of being investigated.

As Morrison put it: “If we are going to so disempower our elected representatives to do things about what is needed in their communities, then what is the point?” Morrison then went on to say that: “No one is suggesting anyone has broken any law are they?”

But that is just it – yes Mr. Morrison you are breaking the law as set out in the Public Governance, Performance and Accountability (PGPA) Act, and if your government will not enforce that law we need an integrity commission that will.

As the objects of the PGPA Act make clear its purpose is “t0 require the Commonwealth and Commonwealth entities: (i) to meet high standards of governance, performance and accountability; and (ii) to provide meaningful information to the Parliament and the public; and (iii) to use and manage public resources properly.”

The PGPA Act then goes on to say that to achieve its purpose, any expenditure of public money should not be approved unless the decision maker is satisfied that the expenditure will be efficient, effective, economical, and ethical.

These requirements of the PGPA Act, are further supported by the Commonwealth Grant Rules and Guidelines (CGRG), which spell out the specific legal requirements for the administration of all grants. The basic intention underpinning the CGRC is, as stated, that “Competitive, merit-based processes should be used to allocate grants based upon clearly defined criteria.”

This in turn means that “Officials should develop policies, procedures and documentation necessary for the effective and efficient governance and accountability of grants administration. This should include the development of grant opportunity guidelines and associated operational guidance for administering grant activities on an ongoing basis.”

These grant opportunity guidelines “should include:

  • grant objectives and purpose;
  • eligibility criteria;
  • clear assessment criteria (if applicable);
  • weighting of assessment criteria;
  • the approval process (as relevant) including the: closing date for applications; § likely decision date; § outline of selection process; § final recommendations; § decision-maker;
  • expected terms and conditions of the grant agreement;
  • indicative reporting and acquittal requirements; and
  • a description of complaint handling, review and/or FOI mechanisms.”

In short, the law already requires that any grant program must establish criteria which will allow a fair assessment of the eligibility and relative merit to determine whether a grant should be paid.

Furthermore, the normal expectation is that this merit assessment would be made by a committee of experts or public servants and their assessment justified in writing. Under the rules, Ministers are supposed to only over-turn such an assessment if he or she obtains evidence in support of that decision and explains in writing the reasons for over-turning the departmental/expert advice. The rules also say that Ministers must report all such instances to the Finance Minister annually, giving their reasons for their approval of each grant.

In sum, it would seem therefore that the framework is in place to ensure a competitive merit-based system of grant allocation, and if that system were properly followed it would ensure that grant programs were administered ethically and with integrity.

But that conclusion begs the question 0f why isn’t that merit-based process for grant allocation always followed as laid down in law?

Part of the answer lies in public servants failing to do their duty. The PGPA Act establishes that public servants have a legal obligation to warn ministers whenever they propose to depart from the legislated due process. It would seem, however, that too often public servants remain silent in these circumstances, but again why?

The obvious answer is that Morrison has encouraged a culture of ministerial entitlement. Ministers are elected and according to Morrison they are then entitled to determine how best to allocate public funds.

Morrison does not seem to care that this view of ministerial entitlement flies in the face of traditional conservative values. The traditional view is that ministers are custodians of public money, and it is not theirs to spend according to their priorities and as they wish. Instead, ministers are bound to follow due process as laid down in the PGPA Act.

But given the Morrison Government’s flagrant disregard for these legal requirements and ethical norms, that is precisely why we need an integrity commission to enforce them.

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