Saturday, 13 October 2012

Why the Liberal government is in trouble over board appointments?

The Liberal State government is in trouble twice in aweek over their appointments to statutory boards. They almost can't help themselves. Maurice Newman had to resign as a director of Port Kembla Port Corporation because of a possible a conflict of interest, and as exposed by the Legislative Council Estimates Committee a political donor to the Treasurer Mike Baird and the Liberal party, Roger Massey-Greene, was appointed to state owned electricity company. 

As Sean Nichols, the Sydney Morning Herald's State Political Editor points out in the Sydney Morning Herald today, both appointments were announced last year by the Treasurer Mike Baird. 

Is there anything wrong with the quality of the appointments? Probably not. Mr Newman is a former chairman of the ABC and Mr Massey – Greene is a very successful Australian businessmen, and having people of that quality adding value to public instrumentalities can be a very good thing. 

Should not the Treasurer or the government of the day appoint people they believe are best qualified for various boards? The answer to that question is yes, they should. The Treasurer and Executive government is accountable to Parliament for the quality of their appointments. 

Then what's the problem? The problem is that the standard and method of appointment of people to government boards was actually set by the Treasurer himself. It was the Treasurer that complained that Labor Party ministers were appointing people they deemed appropriate without a proper process. It was the Treasurer who bleated that the Liberal party will make board appointments transparent and merit-based. It was the Liberal party who said that there were going to make board appointments by independent panels of eminent people. And it was the Liberal party that made appointments and ignored their own rules that they set in place. 

This sort of conduct by the Liberal government is the very reason why governments and politicians are brought into disrepute. For political purposes and to gain sympathetic media coverage they espouse these "holier-than-thou" standards and then ignore them. 

One of the persons appointed was a political donor to the Treasurer and the Liberal Party. Does that mean a political donor is disqualfied for appointment to a government board? The answer must be no, as long as the fact that he made a donation has been publicly disclosed, and that the donation played no part in the decision-making process. 

Should ministers avoid making decisions when someone is a political donor? Does that not create the perception of a conflict of interests? The protection the public have in relation to political donations is that there must be disclosure. If the processes become too rigourous or restrictive then political donations continue, and the risk is they go underground. If they go underground there is no public scrutiny. 

If ministers avoid making decisions because of political donations in fear of public perception, then who is accountable to Parliament and ultimately the people, for the quality of the appointments? What if a person donates to the other political party? Is it OK to appoint someone that donates to the other party but not yours? These are legitimate questions that arise in democracies whose elected participants are required to raise funds unless it is decided that all campaigns should be publicly funded. 

I can well imagine that there are many qualified people able to serve on government boards, who do not wish any proposed appointment be publicly disclosed during a lengthy process. There are many well qualified people who would not even contemplate serving on the board or any other government office without having to be persuaded by the government of the day to serve. 

There is a reason the Westminster system enables ministers to make government appointments and be accountable to Parliament for those appointments. The Treasurer could have announced the appointments, announced that the appointments were not going to be subject to the processes he had earlier put put in place, and given reasons. He could have disclosed that one of them was a Liberal party donor and that fact played no part in the decision-making process. 

He chose to be sneaky and got caught out doing it. There is no room in a democracy for governments to be sneaky. It is the sneakiness that causes the smell and it is this sneaking around that risks damaging the reputation of these two gentlemen. It also may well restrict the ability of governments in the future to get quality people to make themselves available to serve in government positions.

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