Ministerial Code of Conduct

A clear Ministerial Code of Conduct is one part of the armoury of democratic checks and balances needed to ensure open and accountable government. The Northern Territory has not until recently had one. However, the adoption of a Ministerial Code of Conduct was one of the recommendations of the Lawler Inquiry called by the previous Country Liberal government in relation to the so-called Stella Maris Affair in an apparent (and surprisingly successful) attempt to torpedo the political career of then Opposition Leader Delia Lawrie.

The importance of a Ministerial Code of Conduct with “teeth” has become obvious in recent weeks following news that former CLP Minister Bess Price has taken a job with a company named Zodiac to which her department granted contracts worth some $6 million in 2014 and 2015. Some have suggested that the surrounding circumstances are somewhat questionable.

Even more recently, former CLP Chief Minister Adam Giles took up a senior position with Hancock Prospecting, a company owned by Australia’s richest woman Gina Rinehart which benefited from a number of decisions and permits issued by the Northern Territory government over the last four years.

The reason why a code of conduct governing the post-separation employment of former Ministers of the Crown is needed should be fairly obvious. If they are freely able to take employment with companies that have benefited from decisions made by the Minister or his/her department while in office, it raises the possibility that the new job may be a payoff for the benefits delivered. I’m not suggesting that that is actually the case either with Adam Giles or Bess Price, but the mere possibility of such a thing and the lack of any enforceable rules to prevent it are aspects of a system of governance whose deficiencies serve to undermine public confidence in the integrity of government.

More widely, unless there are reasonable restrictions on post-separation employment of former Ministers, the new employer corporation may gain an unfair advantage over the government in relation to contracts on which it may be bidding and favours it is seeking from government. The former minister’s new employer might also gain an unfair advantage over competing businesses. Moreover the former minister could misuse the confidential information of their former employer, which would clearly be unlawful but almost impossible to prove. Most businesses place contractual restraints of trade on the rights of departing executive employees to take jobs with competitors or others with a clear and immediate ability to prejudice their interests, for precisely those sorts of reasons. There is no reason why departing Ministers should not be placed under similar restrictions as long as they are reasonable in extent and duration.

It would not be reasonable to prohibit former Ministers from working for any business operating in an area for which the Minister held portfolio responsibility for an unlimited or even very extended period of time, still less to prohibit a former Chief Minister from working for a business for which he had overarching Chief Executive responsibility but no specific portfolio responsibility (as would appear to be the case with Giles).

More generally, the Territory has a small population and small business community, and a permanent or even significantly long-term prohibition on working for a business with which the former Minister has had any portfolio responsibility at all would be unfair and unworkable. It would effectively force Ministers to leave the Territory to find employment as soon as they lost office. Losing all that knowledge, experience and accumulated wisdom from the Territory would not be in the public interest.

But there certainly should be a prohibition for (say) 12 months after leaving office on former Ministers taking a job with a business operating specifically in their area of portfolio responsibility, especially where that business won government contracts during the Minister’s period in office.

The Giles government did in fact adopt a Ministerial Code of Conduct as recommended by Commissioner Lawler. It is an appendix to the NT Cabinet Handbook. Moreover, it contains a provision on post-separation employment of Ministers, but it is very general and leaves the decision to the discretion and personal integrity of the former minister concerned.

Ministerial codes of conduct in some other states and overseas are more specific and have more “teeth”, as this survey by the Australian Parliamentary Library explains. For example, the provisions of the NSW Ministerial Code concerning post-separation employment are as follows:

7.4 Ministers who, while in office, are considering an offer of post-separation employment or an engagement or who are proposing to provide services after they leave office to third parties (including establishing a business to provide such services) must obtain advice from the Parliamentary Ethics Adviser before accepting any employment or engagement or providing services to third parties which relates or relate to their portfolio responsibilities (including portfolio responsibilities held during the previous two years of Ministerial office).

7.5 Former Ministers must also obtain advice from the Parliamentary Ethics Adviser before accepting any employment or engagement or providing services to third parties (including establishing a business to provide such services) within the first 12 months of leaving Ministerial office, which relates or relate to their former portfolio responsibilities during the last two years in which they held Ministerial office.  This requirement does not apply to any employment or engagement by the Government.

If the minister or former minister fails to obtain that advice or ignores it, that may be held to be a significant breach of the Code and may potentially be found to be “corrupt conduct” by ICAC.

The code of conduct was adopted in response to section 9(1) of the Independent Commission Against Corruption Act 1988 which states that:

9 (1)… conduct does not amount to corrupt conduct unless it could constitute or involve … in the case of conduct of a Minister of the Crown or a member of a House of Parliament—a substantial breach of an applicable code of conduct.

If ICAC finds that a member of parliament (including a minister or former minister) has substantially breached the code of conduct, the finding is reported to the relevant House which decides on the disciplinary action that should be taken. The practical ability of the Legislative Assembly to take any effective disciplinary action against a former Minister who is no longer a member of that parliament is very limited. Nevertheless, the threat of a finding of corrupt conduct by the new NT ICAC (when it is eventually established) is likely to provide a sufficient deterrent against extreme abuses by former ministers.

Further enforcement “teeth” against improper behaviour by former ministers could be provided by legislating to prohibit current Ministers and public servants from having professional contacts with former ministers employed as lobbyists for a period of 18 months after they cease to hold office. Again that is the way the New South Wales laws now operate.

*Image courtesy YouTube and CIS

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