Revelations about Prime Minister Albanese’s free access to the exclusive lounges offered by QANTAS and Virgin Australia, has awoken the Australian public to the additional benefits politicians receive from these airlines. But the travel perks received by politicians is only part of the story. The greater risk to the integrity of Federal Government programmes arises from the acceptance of similar benefits offered by QANTAS or Virgin to highly paid public servants. Particularly senior executive staff who manage law enforcement and regulatory bodies.

On 1 August 2023, the Australia Competition and Consumer Commission (ACCC) commenced federal court action against QANTAS for selling tens of thousands of tickets for flights that had already been cancelled in its system. Last month, the court ordered QANTAS to pay a $100 million civil penalty and $20 million in compensation to impacted customers. As part of the settlement, QANTAS admitted it had misled customers. The chair of the ACCC, Gina Cass-Gottlieb in reference to the conduct stated: “Qantas’s conduct was egregious and unacceptable.”

The court action is a win for customers impacted by the actions by QANTAS. But the success by the ACCC is overshadowed by the actions of its senior management. The gifts and benefits register maintained by the ACCC reveals that prior to and during the investigation into QANTAS, senior managers accepted from the airline, access to the exclusive Chairman’s lounge. That lounge provides a range of benefits, including premium dining. Specifically, the register records for the period 1 January to 31 March 2024, the ACCC Chair Ms Gina Cass-Gottlieb and her partner received Qantas Chairman’s lounge memberships, and it is noted that those memberships have been ongoing since July 2022. The Deputy Chair Mick Keogh is recorded as having Qantas Chairman’s lounge membership since September 2016. While Commissioner Anna Brakey received a Qantas Chairman’s lounge membership which has been ongoing since September 2022. Commissioner Liza Carver Qantas Chairman’s lounge membership has been ongoing since 2011 prior to her joining the ACCC. While Commissioner Stephen Ridgeway has been the beneficiary of a Qantas Chairman’s lounge membership since January 2020.

It might be argued that as the ACCC initiated and successfully secured a penalty against QANTAS the acceptance or keeping the Chairman’s lounge membership had no impact on the decision makers involved in the investigation. Noting that an investigation has many phases commencing from the initial receipt of complaints, the assessment of that information, the identification and analysis of existing evidence, the scope of the investigation to determine what additional evidence needs to be collected, the conduct of the investigation and preparation of the briefs of evidence that will ground legal action. During any phase, senior ACCC managers would expect to be briefed and provide advice when and as necessary. Each stage of any investigation, particularly a complex investigation, is vulnerable to internal and external corruption.

It is not implied in any way, that any senior executive ACCC manager or any employee of the ACCC has engaged in corruption or any form of unethical or unlawful behaviour. However, preventing corruption within an organisation requires managers of all levels to develop and enforce an ethical and law abiding culture. Board members and senior executive who say one thing but do another, send out mixed messages and risk weakening internal controls and any existing culture designed to prevent poor corporate and personal behaviour.

Disclosure of QANTAS Chairman’s lounge membership did not remove the conflict of interest each ACCC manager clearly had. Disclosure is about transparency. It gives the public confidence that government dealings are above board. Failure to remove a conflict of interest, destroys confidence and the trust the public has in government. But the retention of the Chairman’s lounge benefit by senior ACCC staff during the investigation of QANTAS casts a shadow over the investigation because it has reduced transparency. Questions could arise about what involvement the senior executives had in relation to the investigation? If any aspect of the investigation was changed following their advice, what was the advice and what was the impact? Did any of the senior staff involved discuss the investigation with senior QANTAS managers? If so, what was said? Who was present? Were records made?

There was only two ways that the ACCC managers involved could have removed the conflict of interest. They could have, and should have, terminated their Chairman’s lounge membership immediately upon receipt of complaints from the public about QANTAS. And well before any investigation was commenced. Or they could have resigned.

The findings by the Inspector of the National Anti-Corruption Commission into the NACC’s decision not to investigate referrals from the royal commission into the Robodebt Scheme are relevant here. In relation to the conflict of interest held by the Commissioner of the NACC, the Inspector reported that the commissioner “should have not only designated a delegate but removed himself from related decision making processes and limited his exposure to the relevant factual information”. Which the NACC commissioner did not do. Whether the ACCC executives impacted by having QANTAS Chairman’s lounge membership could have or did delegate decision making authority in relation to the QANTAS investigation and after they had terminated their lounge membership, is a matter for them to explain.

The advice from the Inspector of the NACC was released post QANTAS investigation. It provides excellent future guidance. But the action that ACCC executive managers with Chairman’s lounge membership should have taken is obvious. The fact they didn’t terminate their lounge membership brings into question their understanding of corruption risk and how to mitigate against it. Their actions in not terminating their relationship with QANTAS indicates a serious lack of knowledge on how inappropriate behaviour occurs, including the impact of grooming techniques by corporate organisations, criminal groups and foreign intelligence organisations. And like many people employed in Government, they appear to have by their actions, a blind faith that corporate organisations can be trusted. The actions by ACCC executive managers in not terminating their access to the Chairman’s lounge would be akin to me as an AFP investigator having lunch with an organised crime figure or major tax evader, paid for by them, knowing they are the subject of an investigation I am conducting. I have no doubt what the AFP Commissioner would do in relation to my employment if I declared that conflict of interest!

To restore confidence in the conduct of the investigation, the Federal Government must appoint an independent person to review the actions of the ACCC executive in their handling of the QANTAS investigation.