The New South Wales premier, Dominic Perrottet, has defied criticisms of the state’s anti-corruption watchdog by the prime minister, announcing a boost in funding to the body.
On Tuesday, Perrottet told parliament of the change in the way funding will be provided for the Independent Commission Against Corruption (Icac), after meeting with the heads of the state’s key integrity bodies.
But the premier said the new arrangements were “not completely in line” with the model requested by the Icac, which would have separated its funding from ministerial decision-making processes.
The announcement came just hours after Scott Morrison defended his characterisation of the Icac as a “kangaroo court” that had “destroyed people’s reputations and careers before it’s even made a finding”. Last week Perrottet agreed that Morrison had “absolutely” gone too far in his criticisms.
Perrottet indicated the Icac would receive a funding boost in next month’s budget, saying the changes would “better reflect current and future resourcing needs”. He also committed to a “re-baselining” of the agency’s budget in 2023.
“I believe this strikes the right balance, I accept that it is not completely in line in terms of from the Icac’s perspective in relation to the model that they proposed,” Perrottet said on Tuesday.
In recent years the Icac has been forced to ask the government for additional funding in order to hold public inquiries, a situation which leading Sydney barrister Bret Walker SC warned was potentially unlawful.
“With the best will in the world, the senior public officials engaged in the dealings made necessary by the current arrangements for funding Icac cannot avoid a substantial risk of appearing to be capable of exerting, by the power of the purse string, inappropriate influence over Icac’s operations from time to time,” Walker said in advice to the Icac in 2020.
Perrottet said the new funding model would “deal with the issues that they have raised substantively”.
“We’ve come up with what we believe is a model for the integrity agencies that fundamentally addresses the concerns that they have raised,” he said.
“We have now gone back and raised the new model with the integrity agencies and I can inform you today that the changes are that we will make, the majority of them will come into place in terms of the funding model for this year’s budget.”
Funding for the state’s key integrity agencies has been a subject of contention in NSW since former watchdog chief commissioner Peter Hall told a 2019 inquiry that funding cuts proposed by the government would leave the agency with a $4m shortfall that would have an “immediate and serious” effect on its ability to fight corruption.
After the comments, former premier Gladys Berejiklian tasked the Auditor General with conducting a review of the Icac’s funding model which found the independence of the body was threatened because politicians sign off on its funding.
Perrottet said key integrity agencies including the Icac, the NSW Auditor General and the NSW Electoral Commission, would be exempt from efficiency dividends imposed on other government departments, and committed to “provide reasons” for variations in the agencies budgets.
He outlined a new funding process for the integrity agencies that will give the treasurer responsibility for informing the agencies about funding decisions.
In cases where there are any cuts to the agency’s budget, the government will “provide an explanation as to why and that will be transparent for the committee and for the public”.
The Greens anti-corruption spokesperson, Jamie Parker, welcomed the funding increase, but said the government’s announcement failed the “fundamental test” set by the Icac in its request for a funding overhaul.
“Decisions about funding will be more at arm’s length but they won’t be fully out of the reach of the government of the day,” he said.
“The parliament should determine the commission’s funding and not the executive government. These changes don’t resolve that basic conflict of interest.”
