Integrity Questions Cast Shadow Over National Anti-Corruption Commission

A copy of the Report of the Royal Commission into the Robodebt Scheme is seen at Parliament House in Canberra, July 7, 2023. AAP Image/Lukas Coch

If the National Anti-Corruption Commission (NACC) thought a terse exchange with several Senators at a joint Parliamentary Committee hearing on Nov. 22 was to end the litany of bad publicity that has dogged the organisation since its inception, it was wrong.

This weekend, it was revealed that a former senior officer had resigned after becoming “alarmed” over integrity issues.

But even before the hearing, the Commission—already the subject of criticism after it refused to follow up on six referrals from the Royal Commission into Robodebt—came under scrutiny again over its decision-making.

The Commission had promised to appoint an “independent, eminent person.” However, plans to hire former solicitor-general Justin Gleeson for the role were abruptly halted because the NACC was reportedly concerned about how a former Coalition minister—who had been referred for further investigation—might react.

Why Did the NACC Not Pursue?

The decision not to pursue the “Robodebt Six,” exacerbated by the fact that the NACC waited almost a full year before announcing the decision to the public, was the focus of most of the questions Commissioner Paul Brereton, his deputy commissioners, and senior staff faced at Parliament.

The NACC inspector, Gail Furness, found that the perception of bias tainted the decision because Brereton had declared a “close association” with one of the referred people.

Yet he remained involved in the decision-making right up to the final meeting when the matter was decided—although he did hand over the official sign-off to Deputy Commissioner Nicole Rose.

The Commissioner for the Royal Commission into the Robodebt Scheme Catherine Holmes delivers her report to Governor General David Hurley at Government House in Canberra, July 7, 2023.

Brereton spent over 30 minutes of the 90-minute hearing making an opening statement, where he also canvassed who was present and listed the NACC’s work during the previous year, information that had already been announced and available.

Chairperson Senator Karen Grogan extended the sitting time after warning the Commissioner that “the committee has questions.”

First, Deputy Chairperson Helen Haines, wanted to know why—given that Brereton had just assured the Committee the NACC had the resources to do its job—it decided not to act on the Royal Commission’s referrals.

He deferred to Rose since it was “her decision.”

Rose confirmed that resourcing “wasn’t even in the top three” reasons.

Instead, the primary concerns were “a risk of inconsistent outcomes,” “serious concerns in the legal advice raised that we might not be able to reach the threshold of corruption,” and the Commission’s inability to provide individual remedy because the NACC cannot directly punish anyone it finds to have acted corruptly. It can, however, refer its findings to bodies that can take such action.

Indeed, Grogan then asked about how the Royal Commission had referred the six officials to the NACC with the expectation that it would do something about it.

But that wasn’t an “accurate characterisation” of the NACC’s role, Brereton said in response.

“I agree there may be a perception that, because the Royal Commission referred it to us, we should do something, but a royal commission referral to us is no different from any other referral to us. It is then for us to consider whether we’re going to add value in the public interest by doing something,” Brereton said.

However, he later admitted that “the legal advice that we obtained from our lawyers was ... that, if proved, the conduct could fall within the definition of ‘corrupt conduct,’ and we proceeded on the basis that a corruption issue arose but that, for all the reasons given in Deputy Commissioner Rose’s reasons, it was not appropriate for us to take further action.”

Role Under Fire

It was Senator David Shoebridge’s questions that really set sparks flying.

He began by asking Brereton whether he accepted there was “significant public concern” about his role in the Commission’s handling of the Robodebt referral.

The reply was only in “some quarters.”

Shoebridge pressed further, asking, if Brereton accepted that there is “widespread disquiet about how the NACC has handled the Robodebt referral?”

“I accept that there is disquiet in some areas. I’m not prepared to accept that it’s widespread,” Brereton replied.

Shoebridge then cited the eminent State’s Counsel, who prepared a report for the NACC inspector and found that “steps taken by the Commissioner to manage his conflict of interest that conduct arose from a mistake of law, as natural justice required the Commissioner not to participate in the decision-making with respect to [Referred Person 1].”

“I have had different views expressed to me,” Brereton responded. “I accept it as an open view and that it is in the commission’s interests that we accept it and move on.”

Shoebridge asked Brereton to reveal exactly who had expressed different views to him, which Brereton avoided answering.

The Senator continued to press the Commissioner and at one point, the exchange became heated enough for the Chair to interject and issue a warning.

The Commissioner’s unwillingness to detail who may have taken a different view to the Inspector and her legal advisor “raises very real concerns for transparency,” Shoebridge said, “So I give you the opportunity again, Commissioner. Who have you been having private conversations with about your conflict of interest in the NACC?”

And so it went, for quite some time, before Grogan made what she called a “lineball call” that the Commissioner didn’t have to answer since he wasn’t relying on “private conversations” as evidence.

Questions Over Independent Reviewer

Shoebridge then probed Brereton on the appointment of the “independent, eminent person” to review the NACC’s decision against investigating the Robodebt referrals.

He argued it would be “preferable to the institution and your own reputation” if that person agreed with the determination, saying it would create a conflict of interest if it was the Commissioner’s role to choose them.

“No,” said Brereton, “I have no interest in the eminent person agreeing or disagreeing with our original determination ... It wouldn’t be deeply embarrassing to me, since I didn’t make the decision in the first place.”

But Shoebridge referred to the inspect’s finding that Brereton’s decision was tainted by bias amounted to a “failure to deal with your conflict of interests” which has not only significantly damaged the NACC’s reputation but also forced this extra process of appointing another expert, at “enormous public expense.”

He asked Brereton if he accepted that his behaviour sent a “very dangerous message” to the numerous public servants also dealing with conflicts of interest, to which Brereton replied, “I don’t accept that that’s the message.”

Other members of the Committee were also critical, with Labor MP Jerome Laxale saying people in his electorate told him that “they’ve gone from a sense of joy that a Federal Anti-Corruption Commission had been created ... to now profound disappointment about how the NACC has operated since its inception.”

Senior Staffer Resigns, Citing ‘Integrity Issues’

After enduring a mostly skeptical and questioning reception before the Committee, the Commissioner, his deputies, and staff must have been hoping for a quiet weekend.

But then it was revealed that a senior staffer—the acting director of governance, risk, and reporting—had resigned after telling colleagues that she had concerns over “integrity issues” that had arisen even before the NACC began operating.

For instance, Brereton, who had been an appeal judge in New South Wales, hired his associate as an executive assistant without the role being advertised or any competitive selection process taking place, in breach of Australian Public Service guidelines.

A spokesperson for the Commission said the appointment was on a “non-ongoing basis” and that the role was later filled in the usual way.

Meanwhile, in its first annual report, released last week, the NACC disclosed “significant non-compliance” with the Public Governance, Performance, and Accountability Act after spending a large amount of money on construction work on an office without gaining formal written approval as required by the law.

It’s understood this may have occurred in part because staff believed the reporting threshold for Commonwealth AusTender contracts was $100,000 (US$64,800) when it is, in fact, $10,000.