The Gunner Government: A collision between Budget misuse and democratic responsibilities – Part II

by | Jun 25, 2020 | Opinion | 0 comments

Opinion by Dr Don Fuller

This is the second part of a five part presentation of an essay by Dr Don Fuller looking at the characteristics of good government including the principles of transparency and accountability and how the five core attributes of good government make for the foundation of strong economic and community development. Dr Fuller then uses these characteristics to evaluate the Gunner Government, which swept to power in 2016 and famously tabled a document to Parliament entitled, Restoring Integrity to Government– Trust and Integrity Reform Discussion Paper.

Statement on accountability and transparency by the Gunner Government following its election win

The Gunner Government took power in the Northern Territory after the August 2016 election.

Following wide community concerns regarding questions of accountability, transparency and budget decision making under the Giles Government, there was substantial community support for a document tabled in the NT Parliament in November, 2016 by the incoming Government titled Restoring Integrity to Government – Trust and Integrity Reform Discussion Paper.

Key aspects of the report

This document commences with the statement, “Territorians want and deserve a Government they can trust. An open, accountable and transparent Government is essential for this trust to exist.”

It points out that, “Confidence in the integrity of public officials and Government processes is essential if we are to meet the considerable challenges that we face and to grasp the opportunities that we share.”

The document emphasises that “Territorians have the right to access Government information, it belongs to all of us”, and that, “Open, transparent and accountable Government is also the best way to maximise the health and prosperity of the whole community.”

As if to emphasise further, the document states: “A future Territory Labor Government will be guided by the principle of restoring integrity to Government through leadership at the highest level of Government through actions, not just words’”.

Such statements, as the Gunner Government comes to the end of its term, now appear to many to be perplexing, at best.

The Gunner Government: A collision between Budget misuse and democratic responsibilities – Part I

The document further states that maintaining a healthy integrity framework relies on continuing to review of the effectiveness of the system.

This begs the question as to whether, and when, this actually occurred during this term of Government.

Unfortunately, the charge has been made on a number of occasions, that the document that held out so much hope and promise for improved governance should be consigned to the ‘all words, no actions’ bin.

An inability by a Government to meet the objectives that it has set itself in key areas such as integrity, accountability and transparency, serves to further damage an already very fragile Northern Territory system of governance.

Gunner Government decision making – a failure in accountability and transparency

Concerns regarding how seriously the Gunner Government was to treat its accountability and transparency responsibilities surfaced early, following the 2016 election.

In May 2017, previous Labor MLA and Charles Darwin University law lecturer Ken Parish wrote for Crikey, “the Gunner Government’s end of semester report card gives it a fairly miserable failing D grade in the subject accountability and transparency.”

Parish wrote the Gunner Labor Government came to office in August 2016 promising to restore the trust of Territorians in Government, after it had been shattered by four years of chaos, division and dubious ethical behaviour by various members of the Giles CLP regime.

Enacting and boosting safeguards ensuring accountability and transparency were to be at the forefront of the new Government’s program.

“After nine months in office, how are they going,” he asked?

“In my assessment the record is none too impressive.”

Some limited progress was made he argued, to publish the registrable interests of MLAs who potentially could have a conflict of interest in decision making. However, changes were regarded as limited due to the time allowed before publishing such interests.

“In the meantime the Gunner government moved in Parliament a couple of weeks ago to enshrine in legislation its seemingly hasty decision late last year to impose a previously unannounced ‘policy’ for a maximum floor area of 400 square metres for takeaway liquor outlets. 

“The effect of including that ban in parliamentary legislation, as opposed to mere subordinate legislation, will almost certainly be to prevent the circumstances surrounding the decision (including any connection with rather large donations to the ALP by interests associated with the Australian Hotels Association, whose members stand to benefit from the exclusion of Dan Murphy’s) from being probed by the Federal Court in proceedings commenced by Woolworths.”

This resulted in a loss of trust in Government decision making with suspicions that political donations from interests associated with the Australian Hotels Association, had influenced the decision.

The Gunner Government promised to set up a Territory Independent Commission against Corruption. The NT ICAC was funded to the amount of $3 million in the 2017-18 Budget. Which was less than the $3.5 million the Government was stumping up for Bruce Munroe’s Tropical Light exhibition, which was due to run for just 180 days.

However, despite the funding, ICAC did not commence taking reports until end November 2018.

Parish points out that for around half of the term of the Gunner Government neither the Ombudsman nor Commissioner for Public Interest Disclosures had the power to investigate allegations against politicians or their staffers.

While ICAC came out with its first finding this week, that the independent member for Goyder and now former Speaker Kezia Purick engaged in “corrupt conduct” by misleading investigators under oath and engaging in undemocratic behaviour.

The Commissioner Ken Fleming found Ms Purick repeatedly lied to investigators and breached the public trust about her involvement in interfering in the establishment of the North Australia Party, which now Territory Alliance leader Terry Mills had looked at forming in 2018.

It is doubtful whether the NT ICAC will actually ever have the resources to investigate several, or maybe many, dubious actions occurring before the Gunner government came to power. This does little to build trust and confidence in Government decision making free of corruption and malfeasance in the Territory.

More opinion by Dr Fuller

In the 2016 NT election, the Labor party finished with 18 seats and the CLP opposition finished with two seats. The balance of five seats was made up of independents. While the preferential voting system used in the Territory is largely responsible for such lop-sided results, this clearly required a parliamentary leader aware of ethical and democratic responsibilities in the face of a very weak opposition.

It was therefore a very important challenge for the new leader in a situation where the integrity of the democratic political system in the NT was to be sorely tested.

An ethical and responsible leader was beholden to uphold the main principles of a democratic state rather than to attempt to bully a weak opposition into submission or irrelevance, based on an overwhelming number of seats in Government.

In fact, in that election the CLP gained around 32 per cent of the popular vote compared with 42 per cent for the ALP. If a proportional representation voting system had been used, as it is in the smaller jurisdictions of Tasmania and the ACT, the CLP would have had a substantial Opposition of around eight members to the ALP’s 11.

It was clear that a relatively high proportion of the population in the Territory had not voted for a Gunner Labor government. A wise, careful leader needed to take this into account.  

At this time in particular, the Territory required a leader of Government who understood and valued the key principle that the essence of democracy requires that minority rights are also protected.

This keystone principle was expressed by Thomas Jefferson, the third President of the United States, in 1801, in his first inaugural address.

“All . . . will bear in mind this sacred principle, that though the will of the majority is in all cases to prevail, that will to be rightful must be reasonable; that the minority possess their equal rights, which equal law must protect and to violate would be oppression.”

It is profoundly unfortunate for the governance of the Territory then, that the elected minority has had insufficient resources to pursue their task and prevent the sense of such ‘oppression’.

It therefore appeared to some to be a calculated attack on the integrity of the democratic system in the Territory when, as pointed out by Ken Parish, the Chief Minister’s Government decided not to provide any extra staffing or resources (other than two parliamentary library staff shared between all of them) to the five independent MLAs in the Legislative Assembly.

Such assistance is vital to allow the MLAs to subject the Government to effective scrutiny and oversight, a fundamental purpose of Parliament in a Westminster system.

Weakening the capacity of the Legislative Assembly as an effective opposition struck at the heart of the need for accountability and transparency in a democratic system.

The two CLP MLAs were deemed to be the official ‘Opposition’ and given the resources that accompany Opposition status.

Additional reduction in Parliamentary scrutiny

According to Ken Parish, the Gunner Government not only reduced parliamentary oversight and scrutiny by allocating insufficient resources to MLAs, it also significantly watered down very good recommendations by the Select Committee for opening Parliament to the people.

The most serious of these was a decision by the Gunner Government to halve the available time for parliamentary scrutiny of the Government’s Budget by the Estimates Committee from 60 hours to just 30.

In addition the Government rejected a key recommendation by the Select Committee that it give the Auditor-General the power to conduct performance audits on departments and agencies. This is a responsibility given to every other Auditor-General in Australia, except the NT.

As departments and agencies are not legally required in the NT to report on their efficiency and effectiveness, most do not bother to do so.

As Ken Parish notes, “the end result is that the Northern Territory, alone of all Australian states and territories, has no proper system at all for independent scrutiny of Government departments’ efficiency or effectiveness in spending taxpayers’ money.”

In 2019-20 Commonwealth funding to the NT is estimated at $4,3 billion. This is around 66 per cent of the Territory’s Government sector revenue. It is therefore surprising as Ken Parish notes, that the Commonwealth has not required the Northern Territory to establish the appropriate standards of fiscal accountability that occur elsewhere in Australia.

Further events causing concern on the accountability and transparency of the Gunner Government

In June 2018 it was reported that Dong Hai Airlines had begun operating flights between Darwin and Shenzhen. The Government was accused of refusing to reveal the costs of its partnership with the airline, saying it was unaware that the owner had been named in court hearings over the alleged bribing of an official in Hong Kong.

The Government was accused of failing to disclose the cost of the partnership to Territory taxpayers and for how long the agreement would run.

This failure to disclose occurred even though previous subsidy agreements between the NT Government and private airlines involved ‘millions’.

This included the CLP Government giving Airnorth $700,000 for the Darwin to Alice Springs link in 2015 and the previous Henderson Labor Government giving Jetstar $3 million in August 2018 to establish an international hub in Darwin. A further $2 million was given to the airline in 2009 for marketing purposes. Jetstar cancelled the routes in 2013.

Mr Parish said he did not buy the Government’s line that the cost of the partnership is commercial in confidence information. These can be redacted.

“We are entitled to information about how much of our money the NT Government is giving to it as an inducement to fly here.”

Further evidence of problems with accountability and transparency emerged in September 2018 when it was disclosed that a report by the Auditor-General Julie Crisp found the NT Government had handed out billions of dollars in grants without proper record-keeping processed in place and without a Government wide oversight procedure in place.

The audit found that while the Government knew the oversight of the grant system was flawed; by 2018 an improved monitoring system had still not been implemented. It was still not clear what amounts were being paid and for what reason, so major transparency problems remained.

The Auditor-General stated that while she was unable to determine the total amount of money paid out since 2014 because of improper record keeping, it was expected to be in the billions of dollar.

The audit was conducted around the time that the NT Gunner Government was calling on the Commonwealth Government to provide more funding from GST revenue. At the same time, NT debt levels began to escalate to record levels.

The Auditor-General Ms Crisp, reported that “Existing processes are prone to human error due to a lack of programmed [information technology] checks and oversight.”

She further noted, “agencies experience difficulty reconciling grant activity with expenditure and there is an inability to generate meaningful reports on grants issued across the NT Government.”

Ms Crisp found the Department of Chief Minister — which administers a large portion of grant funding annually — did not have modern systems in place to monitor the grants.

This is a startling statement given the importance of government accountability and transparency involving taxpayer funding.

The then Deputy Leader of the Opposition Lia Finocchiaro, called the audit “deeply concerning”, “particularly given the perilous state of the Territory’s budget and burgeoning debt levels.”

“Territorians would expect that awarded public monies would be appropriately acquitted, and that grants and subsequent spending is monitored and reviewed.

“This report poses a series of further questions in relation to the Gunner Labor Government’s so-called open and transparent rhetoric, particularly in relation to spending by the Department of Chief Minister,” she said.

It appears that at this stage serious problems were beginning to emerge for the Gunner Government regarding the priority given to the key democratic principles of accountability and transparency.

Part III of the essay will look at the Gunner Government’s financial management, with its declared financial crisis of December 2018 and the projection of a $35 billion debt in 2029-30. And then to it’s action, or lack there of, on the response to that crisis, the budget repair document produced by the Fiscal Strategy Panel, chaired by former Western Australian under-treasurer John Langoulant. Dr Fuller then looks and the sacking of Minister Ken Vowles and Labor MLAs for speaking out about the crisis.

Professor Don Fuller
Dr Don Fuller.

Dr Don Fuller holds a first class Honours degree and PhD in economics from the University of Adelaide. He has worked as senior public servant in the Territory. This included as a senior economic advisor to Northern Territory chief ministers. He was also Professor of Governance and Head of the Schools of Law and Business at Charles Darwin University. He grew up in Darwin and attended Darwin High School. 

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