Although Gladys Berejiklians intervention to fund projects in her boyfriends electorate may not have been illegal, it should have been. The legislation and rules governing the financial management of public programs should be tightened to prevent such pork barrelling.

Last week the NSW Independent Commission Against Corruption (ICAC) found that the former NSW Premier, Gladys Berejiklian, had engaged in corrupt conduct.

A clamour of voices from Berejiklians side of politics have, however, sought to defend her on the grounds that she was a very good Premier and that she didnt do anything illegal. Even her erstwhile opponent and now the new Labor Premier, Chris Minns, has declined to endorse ICACs conclusion that Berejiklian did engage in serious corruption.

Her supporters have questioned the ICAC finding that Berejiklian is seriously corrupt if she is not so corrupt as to recommend prosecution. But others have responded that corruption is not just a matter of illegal financial transactions for purely personal gain.

Much of the public discussion has focussed on Berejiklians failure to disclose her relationship with her boyfriend, Daryl Maguire, who definitely sought to use his position to enrich himself. There is no doubt that Berejiklian had a conflict of interest in deciding to support Maguires bids for budget funding favouring his electorate, and her failure to disclose her relationship with Maguire was contrary to the ministerial code of conduct.

Surely flouting that code of conduct represents a form of corruption. Nevertheless, Berejiklians supporters are willing us to sympathise with her, as a woman infatuated by the man she loved.

But even putting aside Berejiklians failure to disclose her relationship with her dodgy boyfriend, there still remains the issue of pork barrelling. Again, Berejiklian seems to be unrepentant, maintaining she has nothing to apologise for. Instead, according to Berejiklian, pork barrelling is not an illegal practice. all governments do it. In short, her defence remains that she didnt do anything that was illegal.

Although my reading of the NSW Government Sector Finance Act suggests that might be technically true, it would not be true for a Commonwealth minister in similar circumstances. The laws controlling the administration of Commonwealth funds would certainly have meant that what Berejiklian did was illegal under those laws.

Administrative standards for Commonwealth expenditures

The purpose of most Commonwealth programs is typically spelt out in their governing legislation, and often quite tightly. That will determine how the relevant appropriation must be spent under the law. This requirement was presumably met, at least in general terms, for the couple of major programs that Maguire sponsored with Berejiklians support, but it is not in itself always enough to stop pork barrelling as the ICAC found.

That is why the Australian Public Governance, Performance and Accountability Act says that any expenditure of public money by the Australian government, or its delegated employees, should not be approved unless the administrator is satisfied that the expenditure will be efficient, effective, economical, and ethical (my emphasis added).

Clearly Berejiklian did not and could not meet this Commonwealth requirement when she supported the bids by Maguire for funding projects in his electorate.

In addition, those administering grants from Commonwealth Government Departments are bound by the Commonwealth Grant Rules and Guidelines which require, inter alia, that any such program must establish criteria which will allow a fair assessment of the eligibility and relative merit to determine whether a grant should be paid.

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

Incidentally, these rules and guidelines used not to apply to the grants being administered by some statutory bodies such as Sports Australia. However, following the Sports Rorts scandal during the Morrison Government, and in response to a recommendation by the Auditor General, the Morrison Government extended the coverage of these rules so that they now apply in all such cases.

In short, the rules governing the administration of Commonwealth Government public money would certainly make pork barrelling illegal. If a Commonwealth minister had intervened to secure public funding in the way Berejiklian did that would certainly have been illegal.

If that is not the case in NSW, I suggest their rules need amending, but failure to administer public money consistent with these standards, even if not illegal it is certainly corrupt.

Further improvements in Commonwealth financial administration

Much of the public discussion of the Berejiklian case has focussed on the need for an ICAC, and how this relates to what can be expected from the new Commonwealth agency, the National Anti-Corruption Commission (NACC).

While I am sure that the NACC will not be short of business, I would argue that it is equally important to tighten the system for the administration of public money and its policing. That way there should be much less corruption for the NACC to investigate.

In the Commonwealths case, as I have outlined above, in principle the framework is in place to ensure that the Commonwealth government administers public money ethically and with integrity. Nevertheless, the present rules could be further reinforced by requiring relevant ministers to:

• Publicly release in advance the criteria that will be used to determine the eligibility and relative merit for all program grants before calling for applications, and
• Report all instances of ministerial intervention to change the recommended allocation of program grants to the Parliament (and not just to the Finance Minister), with a statement of the ministers reasons in each case, and within six months of any such intervention?

Equally important is the role of senior public servants in enforcing and policing these rules. Because the Commonwealth has a centralised accounting system, Department of Finance officials can and do monitor all financial transactions, and they should ensure that proper decision-making processes have been followed.

But senior officials from the spending department should take the main responsibility for ensuring due process consistent with the law, and it shouldnt wait until the Department of Finance calls a questionable approval. I think that used to be the case when I was a Departmental Secretary, but that was more than 25 years ago. Unfortunately, there is lots of evidence that senior public servants did not intervene to stop the rorts during the Morrison Government years.

Nevertheless, I am hopeful that if the Albanese Government restores the capability and integrity of the Australian Public Service there will be much less work for the NACC to do.