2.3 Integrity Commissions

Integrity Commissions in Australia: NSW ICAC and Commonwealth NAC

Purpose of standing commissions

Integrity commissions in Australia are standing bodies established by legislation to enhance government accountability. Their foundational purpose is to act as independent oversight mechanisms, distinct from traditional judicial or parliamentary processes. These commissions are endowed with significant powers and functions, explicitly defined by statute, which enable them to proactively initiate investigations, compel the production of information and documents, and report on their findings to the public and Parliament.

Broadly, these commissions can be categorized into two types based on their primary focus: public-service monitoring bodies, which generally focus on administrative efficiency and conduct standards, and law enforcement integrity bodies, which, while having criminal and disciplinary implications, also operate with a broader accountability remit to ensure police and other law enforcement agencies maintain public trust. The focus of this note, however, is on the third, distinct category: anti-corruption bodies.

Types of commissions at NSW and Commonwealth levels

• Public Service Commissions

  • NSW Public Service Commission

  • Commonwealth Australian Public Service Commission

• Law Enforcement Integrity Commissions

  • NSW/State level: various bodies related to policing oversight exist, though not the central focus here.

  • Commonwealth: Australian Commission for Law Enforcement Integrity (ACLEI)

• Anti-corruption bodies (central focus)

  • NSW Independent Commission Against Corruption (ICAC)

  • Commonwealth National Anti-Corruption Commission (NACC, often referred to as NAC)

Historical context and development

The establishment of robust integrity commissions in Australia has its origins in significant public concern over systemic corruption and the crucial role the media played in exposing it. A pivotal moment was a Four Corners investigative program in the $1980s$, which uncovered extensive police corruption in Queensland, including involvement in prostitution and gambling rings. This exposé led directly to the Fitzgerald Inquiry, a state-level public inquiry in Queensland that ultimately revealed high-level police and political corruption, fundamentally reshaping the public's perception of accountability.

In response to this growing imperative for stronger oversight, New South Wales established the ICAC in $1998$. This marked a significant departure from the traditional use of ad hoc Royal Commissions by creating a permanent, standing anti-corruption body. A notable case that underscored ICAC's importance was the investigation into Eddie Obeid, a former NSW minister. ICAC's investigations uncovered systemic corruption involving Obeid's family business interests, leading to his prosecution for misconduct in public office. This case not only demonstrated ICAC's formidable investigative powers but also highlighted its role in deterring corrupt conduct and educating the public and government officials on integrity.

Despite its successes, ICAC has faced debates regarding its independence, accountability, and due process, with some critics pejoratively labeling it a “kangaroo court.” Concurrently, at the Commonwealth level, the trajectory for a federal anti-corruption commission was protracted. Political debates spanned years, with various models proposed by both Labor and Coalition governments. The eventual emergence of the NAC at the Commonwealth level in $2023$ followed extensive deliberations, contrasting sharply with earlier, weaker watchdog proposals. A key turning point was Labor's 2018 promise for a strong federal body and the $2022$ election outcomes, which significantly shifted momentum toward establishing a more powerful commission. Throughout this historical development, themes of media influence and public trust have consistently shaped the perception and operational mandates of both NSW ICAC and the Commonwealth NAC.

Objectives and core functions

Both the NSW ICAC and Commonwealth NAC share similar core objectives in combating corruption, focusing on detection, investigation, prevention, and education. Despite these similarities, their specific mandates and priorities, as defined by their governing legislation, reflect their respective jurisdictional needs and the political environments in which they operate.

• NSW ICAC (as per its governing Act)

  • Objective: To promote integrity and accountability within public administration across NSW.

  • Primary function: Its central role is to investigate and expose corrupt conduct, thereby holding individuals accountable through thorough inquiries.

  • Corruption prevention: ICAC actively recommends reforms aimed at reducing opportunities for corruption. For example, it proposed reforms to the Parliamentary Code of Conduct concerning conflicts of interest following investigations involving former Premier Berejiklian.

  • Education: A vital function involves educating government agencies and the public about the risks and manifestations of corruption. This includes providing tailored training sessions, publishing anti-corruption guidelines, raising awareness of corruption signs, and promoting ethical conduct and robust integrity systems across the NSW public sector.

• Commonwealth NAC (NACC; section $3$ objectives in relevant Act)

  • Objectives: The NAC's mandate includes facilitating the detection of corruption, investigating serious and systemic corruption, preventing future corrupt acts, and educating the public and officials about corruption risks.

  • Similarities to ICAC: While sharing core functions with ICAC, the NAC places an explicit emphasis on investigating serious and systemic corrupt conduct, reflecting a more targeted approach at the federal level.

What counts as “corrupt conduct” (definitions and scope)

The definitions of “corrupt conduct” for both the NSW ICAC and Commonwealth NAC are intentionally broad, encompassing a wide range of actions by public officials and, where relevant to the exercise of public power, members of the general public. This expansive scope ensures that various forms of wrongdoing, whether direct or indirect, can be investigated and addressed, reflecting the complex nature of corrupt activities. Additionally, this inclusive definition allows for the recognition of behaviors that may undermine public trust, including bribery, fraud, misuse of office, and other forms of unethical conduct that detract from the integrity of public service.

• NSW ICAC definition highlights:

  • Breach of public trust: This includes situations where an official acts in a way that undermines confidence in public administration for personal gain or improper reasons.

  • Improper use of information or documents: Covers the misuse of confidential information obtained through one’s official role for personal benefit or to disadvantage others (e.g., insider trading, leaking sensitive government information).

  • Dishonest or partial exercise of official power: Involves actions taken by an official that are biased, unfair, or motivated by private interests rather than the public good (including for family members or associates).

  • Any conduct adversely affecting honest and impartial exercise of official powers or duties: A broad category covering any behavior that could compromise the integrity of public decision-making or official functions by a public official, whether through overt acts or omissions.

• Commonwealth NAC definition mirrors: It includes similar categories of wrongdoing such as abuse of office, misuses of information, and other acts that compromise public integrity, though typically focused on Commonwealth public officials and Commonwealth matters.These definitions aim to establish a clear framework for identifying and addressing integrity violations within government institutions, thereby ensuring accountability and fostering public trust.

• Key features common to both:

  • Conspiracy and acting in concert: Both bodies can investigate corrupt conduct that involves collaboration or group wrongdoing, recognizing that corruption often involves multiple parties.

  • Attempts and completed acts: Corrupt conduct includes not only completed acts but also attempts, reflecting a preventative and proactive approach to law enforcement. This means an investigation can proceed even if the corrupt scheme did not fully materialise.

  • Retroactive reach: Both bodies also have a retroactive reach, allowing them to investigate conduct that occurred prior to their enactment, provided it falls within the current definition of corrupt conduct at the time of the investigation. This is crucial for addressing long-standing patterns of corruption.

  • Broad scope of individuals: The definitions extend to public officials (including ministers, Members of Parliament, public servants across all levels of government or federal agencies) and members of the general public who are involved in or facilitate corrupt conduct linked to public administration, such as private individuals offering bribes or engaging in fraudulent activities impacting public funds.

Thresholds and scope of investigations (what is investigated)

Both statutes establishing these commissions set a defined seriousness threshold for investigations to prevent resources from being diverted to trivial breaches and to focus on significant matters. This ensures that their powerful investigative tools are applied to appropriate cases, targeting high-impact corruption that undermines public confidence.

• Commonwealth NAC: Section 41 of its governing Act explicitly requires that any investigation undertaken by the NAC must involve conduct that is either serious or systemic. The term “serious” implies conduct that involves significant financial loss, substantial breach of public trust, or high-level official involvement. “Systemic” refers to widespread or recurring corrupt conduct within an agency or sector, indicating a breakdown of integrity controls.

• NSW ICAC: While Section 12A of the NSW Act emphasises prioritising serious corrupt conduct and systemic conduct, it is not as prescriptive as the NAC's specific requirement. Nevertheless, it guides ICAC in the same strategic direction, ensuring resources are allocated effectively, focusing on matters that pose the greatest risk to public integrity.

• The definitional framework in the NSW Act: Sections 7, 8, and 9 work in conjunction to define what constitutes corrupt conduct. Generally, corrupt conduct includes types of behavior outlined in Section 88 (e.g., bribery, fraud, dishonest behavior by officials), but only if not excluded by Section 99. Section 99 typically narrows the scope by linking corrupt conduct to actions that would constitute criminal offenses, serious disciplinary offenses, or grounds for termination of employment for most public officials. This ensures that ICAC's findings align with serious breaches of professional or legal obligations.

  However, for Ministers and Members of Parliament, an additional provision (Section 9191) allows corrupt conduct to include substantial breaches of a ministerial code of conduct. This broader provision means a Minister or MP can be found to have engaged in corrupt conduct even if their actions do not strictly equate to a criminal or disciplinary offense applicable to other public servants. This acknowledges the higher ethical standards and public trust expected of elected officials, allowing ICAC to investigate and make findings on significant ethical lapses that might not meet the criminal threshold for a public servant but are clearly a breach of their specific duties as an elected representative.

This intricate legal framework demonstrates the law's attempt to strike a balance between providing comprehensive oversight to maintain public integrity and imposing practical limits on the commissions' investigative reach, ensuring they focus on significant breaches of public trust rather than minor administrative errors. It also reflects the different accountability frameworks for various public official roles.

• The integrity commission's mandate empowers it to assess and address a wide range of unethical behaviors, promoting transparency and accountability across the government.

Example case illustrating definition and threshold (Berejiklian v ICAC)

One of the most significant recent cases illustrating the application of corrupt conduct definitions and thresholds is Berejiklian v ICAC. Former NSW Premier Gladys Berejiklian was investigated by ICAC concerning her undisclosed personal relationship with former MP Darryl Maguire, specifically focusing on grant decisions she made or oversaw that allegedly benefited Maguire’s electorate or projects he was involved with. ICAC's findings determined that Berejiklian had engaged in serious corrupt conduct, including a breach of the code of conduct, partial exercise of power (by failing to declare her conflict of interest and creating a conflict), and a breach of public trust (by exercising public functions influenced by private interests).

In the subsequent challenge before the NSW Court of Appeal, arguments were raised that ICAC had adopted an overly broad public-duty standard in its interpretation of corrupt conduct and that causation for corruption should employ a more stringent direct test rather than ICAC's broader approach. The Court of Appeal, in its judgment, largely upheld ICAC's interpretion, affirming that a breach of public trust, partial exercise of power, or a failure to declare conflicts of interest can constitute corrupt conduct even if no direct financial benefit to the public official is proven, particularly for those in high office. This case reinforced ICAC's broad powers to investigate and make findings on indirect forms of corruption and ethical breaches that undermine public confidence, especially concerning high-ranking officials.