Anti-corruption commissions are intrusive and unnecessary

Despite recent calls to establish a federal anti-corruption commission and to further empower its Victorian equivalent, IBAC, the fact remains that these commissions unnecessarily violate fundamental civil liberties. Nor do they substantially affect corruption, because public sector corruption is a product of the way government operates.

Anti-corruption commissions differ from police because they can force people to answer self-incriminating questions. Ordinarily, forced confessions are regarded as coercive, unreliable, and evidence of police misconduct. They are inadmissible at trial, so they do not assist in bringing criminals to justice. There is also no evidence that coercing witnesses to answer questions reduces corruption, or that it was necessary to do so in order complete any of the investigations undertaken by any commission. The commissions’ greatest power is not just intrusive but unnecessary.

In addition, because these commissions cannot lay charges, suspects can be left clueless about the case against them. NSW MP Mike Gallacher, for one, has been left in this position for the last 18 months after being accused by the NSW commission, ICAC, of improperly soliciting donations. He is still unable to defend his name.

Presently, Victoria’s anti-corruption commission, IBAC, must be reasonably satisfied that “serious corrupt conduct” has occurred before it can use its powers. It cannot do so if there is not enough evidence or if the allegations are trivial. This prevents law enforcement from engaging in unnecessary harassment.

By contrast, the NSW anti-corruption commission, ICAC, can investigate allegedly corrupt conduct even if it is not reasonably satisfied that it occurred or that it is serious. While former Judge Stephen Charles has called for Victoria’s IBAC to have this power as well, ICAC has a record of using it to engage in wild goose chases. It investigated a public prosecutor, Margaret Cuneen, for suggesting to a mechanic that her son’s girlfriend should fake chest pains following a car accident to avoid a breathalyzer test. She claims it was a joke because the girlfriend had breast implants. Ms Cuneen convinced the High Court that the allegation was unrelated to public corruption. The investigation was stopped. The Director of Public Prosecutions took no further action. ICAC—that is, the taxpayer—was ordered to pay her legal costs. The entire exercise appears unnecessary.

Public corruption occurs because, unlike private businesses, government agencies do not face bankruptcy if they waste money. Moreover, government agencies do not operate for profit, so it is hard to assess whether their operations are cost-effective. This encourages waste. By contrast, competition and the prospect of bankruptcy are a natural brake on corruption in the private sector. Law enforcement can only catch a few wrongdoers, often years after the fact. It cannot change how the public service operates.

The Victorian Department of Transport, for example, wasted over a billion dollars on the Myki ticketing system. Departmental officials also separately siphoned over $25 million towards family companies between 2006-2013. Complaints about the system’s punctuality, reliability, and convenience are rife, yet it continues to have responsibility for public transport. By contrast, Tokyo enjoys a fully privatised transportation network with an excellent reputation.

Similarly, the Department of Education wasted $240 million in public funds for the failed implementation of the state-wide school intranet network “Ultranet”. IBAC is presently investigating allegations that departmental officials purchased shares in Ultranet’s winning tenderer. Meanwhile, other departmental officials were separately caught siphoning millions of dollars in funds using false invoices.

The department’s funding powers should be eliminated and a voucher scheme should be implemented in its place. Voucher schemes empower schools to independently manage their budgets and receive state funding based on enrolments. Budgets then expand or contract depending on the school’s enrolments, which in turn will depend on the school’s performance as parents vote with their feet. Finland employs voucher schemes and its schools are among the world’s best.

Establishing a federal anti-corruption commission akin to ICAC will do nothing to reduce corruption. It will simply undermine the right to silence. However, market-based reforms like the privatisation of public services and public education voucher schemes will reduce waste and corruption as well as improve living standards for Australians.