Regulation of secondary employment for Members of the NSW Legislative Assembly
Report to the Speaker of the Legislative Assembly
SEPTEMBER 2003
This publication is available in other formats for the vision impaired upon request. Please advise of format needed, for example large print or as an ASCII file. This publication is available on the ICAC website in HTML format www.icac.nsw.gov.au
ISBN 1 920726 31 4
© September 2003 - Copyright in this work is held by the Independent Commission Against Corruption.
Division 3 of the Commonwealth Copyright Act 1968 recognises that limited further use of this material can occur for the purposes of `fair dealing', for example; study, research or criticism etc. However, if you wish to make use of this material other than as permitted by the Copyright Act 1968, please write to the Commission at GPO Box 500, Sydney NSW 2001.
This report and further information about the Independent Commission Against Corruption can be found on the Commission's website at www.icac.nsw.gov.au
Acknowledgements
We would like to thank the Members of Parliament who assisted us by responding to the letter distributed to Members of the New South Wales Legislative Assembly requesting their views on the topics addressed in this report.
Cover image courtesy NSW Parliament.
INDEPENDENT COMMISSION AGAINST CORRUPTION
address Level 21, 133 Castlereagh Street Sydney, New South Wales, Australia 2000
postal address GPO Box 500, Sydney, New South Wales, Australia 2001
dx 557 Sydney
telephone 02 8281 5999, 1800 463 909 (toll free, for callers outside metropolitan Sydney)
facsimile 02 9264 5364
email icac@icac.nsw.gov.au
office hours 9.00am to 5.00pm, Monday to Friday
The Hon. John Aquilina mp
Speaker
Legislative Assembly
Parliament House
Sydney NSW 2000
Mr Speaker
I am pleased to present the report of the Independent Commission Against Corruption on possible regulation or limitation on secondary employment of Members in the field of `public affairs'.
This report has been prepared in response to a resolution of the Legislative Assembly requesting the ICAC to review the Assembly's Code of Conduct in respect of limiting secondary employment in the field of `public affairs'.
The report considers relevant provisions in four overseas parliaments - the British House of Commons, the Scottish Parliament, the Legislative Assembly of Ontario and the Canadian House of Commons. The report also draws on a literature review and a survey of the views of Members of the Assembly in respect of their current model of regulation of parliamentary standards relating to secondary employment and related conflicts of interest.
A number of recommendations are made for reform in the NSW Legislative Assembly in respect of secondary employment and related interests, and potential conflicts arising from them.
Yours sincerely
Irene Moss ao
Commissioner
Chapter 2 - Regulation of secondary employment 2424
Chapter 3 - British House of Commons 3535
Chapter 4 - Scottish Parliament 4949
Chapter 5 - Alternative models to the UK and Scotland 5858
Chapter 6 - Reform for the NSW Legislative Assembly 6969
Appendix A - Comments by Members of the Legislative Assembly 9393
Appendix B - Code of Conduct - NSW Parliament 9696
Appendix C - Section 14A Constitution Act 1902 9898
Appendix D - Excerpts from the Constitution (Disclosures by Members) Regulation 1983 100100
Appendix E - Schedule 1 (Forms) of the Constitution (Disclosures by Members) Regulation 1983 103103
Appendix F - Code of conduct for Members of the British House of Commons 110110
Appendix G - Standing Order 150, British House of Commons - establishment of Parliamentary Commissioner for Standards 113113
Appendix H - Resolutions of the British House of Commons, 26 June 2003.* 114114
Appendix I - Standing Order 149, British House of Commons - establishment of the Select Committee on Standards and Privileges 117117
Appendix J - Complaints handling process in the British House of Commons 119119
Appendix K - Section 39 of the Scotland Act 1998 (Members' interests) 120120
This report has been prepared in response to a resolution of the New South Wales Legislative Assembly (the Assembly) requesting the Independent Commission Against Corruption (ICAC) to review the Assembly's Code of Conduct in respect of limiting secondary employment in the field of `public affairs'. The resolution specifically requested the ICAC to consider provisions in the British House of Commons and the Scottish Parliament, and any relevant provisions in other jurisdictions.
In preparing this report, the ICAC considered:
· Models for the regulation of parliamentary standards relating to secondary employment and related conflicts of interest in the British House of Commons, the Scottish Parliament, the Ontario Legislative Assembly, and the Canadian House of Commons.
· The literature relating to the topic, including the reports of parliamentary committees having jurisdiction over the models in place in the above-mentioned Parliaments.
· The views of Members of the NSW Assembly in respect of their current model of regulation of parliamentary standards relating to secondary employment and related conflicts of interest.
In considering the above, the ICAC has made recommendations for reform in the NSW Legislative Assembly in respect of secondary employment and related interests, and potential conflicts arising from them.
NSW Legislative Assembly
The regulatory framework in place in the NSW Legislative Assembly includes an aspirational Code of Conduct, which sets out the broad principles that should underpin the conduct of Members. It includes a statement that Members should not participate in proceedings of Parliament in return for payment or any other personal financial benefit and refers to Members' obligation to declare conflicts of interest.
The Constitution Act 1902 (the Constitution Act) and the Constitution (Disclosure by Members) Regulation 1983 (the Regulation) are the main instruments dealing with conflicts of interest. They establish and detail the operation of a register of pecuniary interests, requiring Members to make disclosures relating to secondary employment and directorships and requiring limited details to be disclosed.
Breaches of the Code of Conduct and pecuniary interest requirements can be dealt with by the ICAC, although the jurisdiction of the ICAC extends only to corrupt conduct that could amount to a `substantial' breach of the Code of Conduct. The ICAC's role is further limited in that it cannot investigate conduct that is protected by parliamentary privilege. Alternative approaches for dealing with this type of conduct include the establishment of a parliamentary committee to investigate, or the establishment of a Commission of Inquiry under the Special Commissions of Inquiry Act 1983. However, there are limitations to both of these approaches.
The NSW Assembly has a Standing Committee on Ethics and a Parliamentary Ethics Adviser, although neither the Committee nor the Adviser has the authority to investigate breaches of either the Code of Conduct or the pecuniary interest requirements.
British House of Commons
The model of regulation of parliamentary standards relating to secondary employment and related conflicts of interest in the British House of Commons is considerably more complex than that in use in the NSW Assembly. The history leading to the establishment of the British model included a number of scandals in the 1980s and particularly in the early 1990s that severely undermined public confidence in the integrity of MPs and of the Parliament itself. In particular, at the time, a significant number of Members of the House of Commons had financial relationships with outside bodies which directly related to their membership of that House.
The current model includes a Code of Conduct that is aspirational like that in place in the NSW Assembly. Unlike the Assembly's Code, however, the British Code is accompanied by an extensive guide for Members that sets out the operation of the rules that govern the conduct of Members. The rules prohibit paid advocacy and set out serious consequences for a breach of this rule. There is no prohibition on any other form of secondary employment.
The disclosure regime for conflicts of interests is detailed and extensive. It requires Members involved in secondary employment that depends essentially upon, or arises out of the Member's position as a Member of Parliament to disclose the nature of that work and the clients to whom the services are provided. Members are also required to declare past interests that may have relevance to their current parliamentary duties. The register of interests is an electronic record that is accessible on the Internet. In addition Members are required to disclose changes in material interests within 30 days of that change occurring.
The British House of Commons model also includes a Parliamentary Commissioner for Standards who has advisory and investigative functions. The Parliamentary Commissioner is a non-statutory post and is an officer appointed by the House of Commons. The position derives its powers from the Parliament, and the Parliamentary Commissioner can conduct hearings and call for people and papers. The Commissioner submits investigative reports to the Committee on Standards and Privileges, including his or her opinion as to whether, on the basis of the facts, the Code of Conduct has been breached. The Commissioner cannot, however, make recommendations as to what sanctions can be imposed.
Recommendations on the imposition of sanctions are a matter for the Committee on Standards and Privileges, which considers specific matters relating to privilege, oversees all the work of the Parliamentary Commissioner for Standards, and considers any matter relating to the conduct of any Member. The Committee receives reports from the Parliamentary Commissioner and must decide whether to agree with the Commissioner's findings. In some cases, the Committee itself may determine to further investigate the matter before adjudicating. If the Committee concurs that a complaint is upheld, the Committee then recommends to the House what penalty should be considered. The sanctions that can be imposed include requiring the Member to apologise to the House, suspending the Member for a period of time, withholding the Member's salary for a specified period of time without suspension, and expulsion.
In serious cases where the allegation is contested by the subject Member (i.e the Member who is subject of the investigation), an investigatory panel may be established. This panel is comprised of the Parliamentary Commissioner (Chair of the panel), and two assessors, one of whom is to be a legally qualified person appointed by the Commissioner, and the other to be a Member appointed by the Speaker. Like the Parliamentary Commissioner, the panel gives opinions as to whether a breach has occurred, but cannot make recommendations as to sanctions that should be considered.
The Scottish Parliament
The Scottish Parliament differs from the NSW Legislative Assembly and the British House of Commons in that it is a devolved Parliament, its model of regulation of parliamentary standards is underpinned by statute and the Parliament itself does not operate under the protection of parliamentary privilege. Therefore issues of ethical conduct and regulation are mainly dealt with through statutory or judicial regulation as opposed to parliamentary law and practice.
The current model of regulation includes a Code of Conduct which is an extensive document being some 87 pages long and derives its authority from the Scotland Act 1998 (Transitory and Transitional Provisions) (Members' Interests) Order 1999. Paid advocacy is prohibited and Members are not to accept any paid work to provide services as a parliamentary strategist, adviser or consultant. There is no prohibition on any other form of secondary employment. A Member who breaches the paid advocacy rule can be found guilty of an offence and is liable on summary conviction to a fine of up to 5000 pounds. The rules cover past remuneration, expected remuneration as well as current remuneration, and also extend to remuneration to a client or associate of the Member.
The disclosure regime requires Members to notify of a new or changed interest within 30 days. In respect of secondary employment it includes being employed, self-employed, a holder of an officer, a director of an undertaking or partner in a firm or undertaking a trade, profession or vocation or any other work. The disclosure provisions also require a Member to make an oral statement declaring the nature of any relevant registrable interest before any proceedings where it could be considered that the interest could prejudice, or could appear to prejudice, the Member's ability to participate in a disinterested manner in those proceedings. Failure to do so may result in the Member being found guilty of an offence and liable on summary conviction to a fine not exceeding 5000 pounds. It is worth noting that the Scottish Parliament Standards Committee has proposed making mandatory the registration of non-pecuniary interests that might be thought by others to influence a Member's actions in the Parliament.
Like the British House of Commons model, the Scottish Parliament has established a Parliamentary Standards Commissioner although the position is established through statute rather than by resolution of the Parliament. The Parliamentary Standards Commissioner has only an investigative role because of concerns about the potential conflict between the roles of adviser and investigator. The legislation gives the Commissioner the power to call for witnesses and documents and makes it an offence for failure to comply with notices of the Commissioner to appear or produce documents. Like the British House of Commons model, the Parliamentary Standards Commissioner can make findings but not recommendations on sanctions to be imposed by the House if a Member has been found to have breached a provision of the Code of Conduct.
The Scottish Parliament has a Standards Committee that receives reports of the Parliamentary Standards Commissioner and considers the findings and conclusions. The Committee can agree with the findings, refer the complaint back to the Commissioner for further investigation or conduct its own investigation into the complaint. If the Committee agrees there has been a breach, it can recommend to the Parliament what sanctions should be imposed on the subject Member (i.e. the Member who is the subject of the report).
The Ontario Legislative Assembly
The Ontario Legislative Assembly was considered because it offers some variations on the model in the use in the British House of Commons and the Scottish Parliament. The rules regarding conflicts of interest are set out in the Members' Integrity Act 1994 (Ontario, Canada).
The Act prohibits Members who hold positions in the Cabinet from engaging in any form of secondary employment and from holding an office, directorship, or partnership. In addition Cabinet Members are prohibited from holding or trading in securities, stocks, futures or commodities. However, the Act does allow Members of Cabinet to hold assets in `blind' trust (i.e. a trust in which the beneficiary is unable to inspect the trust instruments, including the trust accounts). Ordinary Members of the Parliament are allowed to engage in secondary employment and hold investments.
The Act also prohibits all Members from knowingly being a party to a contract with the Government under which the Member receives a benefit and from having an interest in a partnership or in a private company that is party to a contract with the Government under which the partnership or company receives a benefit.
The procedures on declaration of conflicts of interest are also very strict. For example, if a member of the Cabinet believes he or she may have a conflict in a matter that requires the Member's decision, he or she is required to ask the Premier or Deputy Premier to appoint another Member of the Cabinet to perform the Member's duties in the matter for the purpose of making the decision. Similarly if any Member has a conflict on a matter that is before the House, the member is required, before proceedings begin, to disclose that conflict and to withdraw from the meeting or proceeding without voting or participating in consideration of the matter.
After their appointment, Members are required to file with the Integrity Commissioner a private disclosure statement and are required to meet with the Integrity Commissioner to ensure that adequate disclosure has been made. The Integrity Commissioner then prepares a public disclosure statement on the basis of the information provided by the Member. The Integrity Commissioner has the discretion to withhold information from public disclosure if he or she is of the view that the information is not relevant to the purpose of the Act.
The Integrity Commissioner has a similar investigatory role to that of the Parliamentary Commissioner in the British House of Commons and the Scottish Parliament, except that the Integrity Commissioner:
· can only receive complaints from Members (not the general public);
· can elect to exercise the power of a commission under the Public Inquiries Act 1990 (Ontario, Canada);
· is required to recommend the type of action that can be taken in respect of a member who has contravened the Act (action can range from no penalty to the Member's seat being declared vacant).
The House can either accept or reject the recommendation of sanction, but cannot modify it.
The Canadian House of Commons
Like the Ontario Assembly model, the Canadian House of Commons generally prohibits senior Members from engaging in secondary employment. The current model also includes an Ethics Counsellor whose main task is maintaining personal confidential files. Paid advocacy is also prohibited under the Parliament of Canada Act. A Member who contravenes this section of the Act is guilty of an offence and is liable to a fine not exceeding $2000, and is disqualified from being a Member of the House and from holding any office in the public service of Canada for five years after conviction of the offence. Furthermore, a person who gives, offers or promises a benefit to a Member to advocate in the Parliament is guilty of an indictable offence and liable to imprisonment for a term not exceeding one year and to a fine not exceeding $2000.
The House is currently considering certain changes to the model, including replacing the Ethics Counsellor with an Ethics Commissioner through amendment to the Parliament of Canada Act. In conjunction with this proposal, the Canadian House of Commons Standing Committee on Procedures and House Affairs has produced a report that proposes a Conflict of Interest Code for Members and gives the Ethics Commissioner the jurisdiction to investigate breaches of the Code.
The Committee has formed the view that the Ethics Commissioner should report directly to the House and that having a Committee with the role of considering the reports of the Ethics Commissioner and undertaking investigation itself of serious contested cases unnecessarily complicates the model. The Committee is also recommending that the Ethics Commissioner have an obligation to recommend to the House sanctions to be considered for a Member who has been found to have breached the Code.
Reforms for the NSW Legislative Assembly
In developing recommendations for this report, the ICAC was mindful that the terms of the Assembly's resolution extended only to conflicts of interests relating to secondary employment, and that the purpose of the report was not to recommend changes to make the framework in the NSW Legislative Assembly more closely resemble that applied in the overseas parliaments considered in the report. The ICAC's objective was to look at elements of other models relating to secondary employment and related conflicts of interest, and to consider if those elements could be adopted or adapted into the model currently in use in the NSW Legislative Assembly. In developing its recommendations the ICAC has considered the provisions in overseas parliaments as well as the particular context of the NSW Legislative Assembly.
Fourteen detailed recommendations have been made. In summary, the ICAC recommends:
· that the provisions for regulation apply to all forms of secondary employment, not just employment relating to providing advice on `public affairs';
· that a guide for Members be established to assist Members in understanding and applying the Code and any other rules relating to the conduct of Members;
· that the Code of Conduct include a statement that Member's primary obligation is to their constituents and the people of NSW;
· that paid advocacy be prohibited;
· that consideration be given as to whether and how to prohibit secondary employment as a parliamentary strategist, adviser or consultant;
· the implementation of greater disclosure requirements in respect of all forms of secondary employment;
· that Members be required to declare relevant conflicts of interest relating to past and present secondary employment before proceedings in Parliament;
· that employment arising or relating to Membership of the Parliament be subject to a detailed disclosure regime;
· that Members be required to update the register within 30 days of a new interest commencing or a current interest changing;
· the establishment of an electronic database of the register of pecuniary interests;
· the review of forms used to declare conflicts of interest;
· the establishment of a procedure to deal with serious allegations of a breach of the Code of Conduct and/or pecuniary interests register where parliamentary privilege protects the conduct from investigation by the ICAC - the options are amendment to the ICAC Act or the appointment of an Officer of the Parliament to undertake such investigations on a case-by-case basis.
Finally, the ICAC has recommended that the NSW Legislative Assembly determine the most effective means of implementing the recommendations in the report - either by legislative amendment and/or by way of resolution of the House.
List of recommendations
RECOMMENDATION 1 - REFORMS FOR ALL TYPES OF SECONDARY EMPLOYMENT
That the New South Wales Legislative Assembly consider provisions for appropriate declaration and management of all forms of secondary employment and the extent to which they may conflict, or appear to conflict, with a Member's parliamentary duties.
RECOMMENDATION 2 - GUIDE TO ASSIST MEMBERS ON CONDUCT AND DISCLOSURE
That the New South Wales Legislative Assembly consider the development of a guide, similar to the British House of Commons' Guide to the Rules relating to the Conduct of Members, to assist Members in understanding and applying the Code and any other rules relating to the conduct of Members, including those set out in the Constitution Act 1902 and the Constitution (Disclosures by Members) Regulation 1983.
RECOMMENDATION 3 - ADDITIONAL PRINCIPLE FOR THE CODE OF CONDUCT
That the New South Wales Legislative Assembly consider an amendment to the Code of Conduct to include an additional principle or responsibility which sets out that a Member's primary obligation is to their constituents, and to the people of New South Wales.
RECOMMENDATION 4 - DEFINING PAID ADVOCACY IN THE CODE OF CONDUCT
That the title of clause 2 in the Members' Code of Conduct be amended to read `Bribery and Paid Advocacy' to reflect the fact that the description of activities contained in that clause is not confined to bribery.
RECOMMENDATION 5 - PROHIBITING PAID ADVOCACY
That paid advocacy be prohibited in the New South Wales Legislative Assembly and that a breach of this rule be grounds for the House to expel a Member of Parliament. This provision should be enforced by way of either a resolution of the House or amendment to legislation, and in developing a definition, the Assembly should give careful consideration to the experiences in the British House of Commons and the Scottish Parliament.
RECOMMENDATION 6 - PAID PARLIAMENTARY STRATEGIST, ADVISER OR CONSULTANT
That the New South Wales Legislative Assembly consider the particular situation of secondary employment as a parliamentary strategist, adviser or consultant and determine whether this type of secondary employment should be prohibited or should be permitted within the current disclosure regime.
RECOMMENDATION 7 - GREATER DETAIL IN THE REGISTER OF PECUNIARY INTERESTS
That Members undertaking secondary employment should be required to provide a description of the services being provided and/or activities being undertaken, and that the description should be sufficiently detailed that a reasonable person would have an understanding of the actual work being performed by the Member on inspection of the register.
RECOMMENDATION 8 - DECLARING CONFLICTS OF INTERESTS BEFORE PROCEEDINGS IN PARLIAMENT
A Member should be required to disclose a conflict of interest at the start of any proceedings in Parliament which relate to the interests of any employer, association or client who has employed, or is currently employing, the Member. In developing the detail of a disclosure-before-proceedings rule, consideration should be given to the experience in the British House of Commons, the Scottish Parliament and the Ontario Legislative Assembly.
RECOMMENDATION 9 - EMPLOYMENT ARISING OR RELATING TO MEMBERSHIP OF THE PARLIAMENT
Where a Member is engaged in secondary employment which depends upon, or arise out of, the Member's position as a Member of Parliament, that this should be indicated in the pecuniary interests register. The Member should be required to list all individuals/organisations to which the Member's services are provided, with a description of the nature of the business of the employer, client, or association in each case.
Further to this provision, where the Member is engaged by a company or where the Member is a Director of a company which in itself is a consultancy, then the Member should also disclose those of the consultancy's clients with whom he or she has a personal connection or who benefit from the Member's advice or service.
Further to this provision, where the income received from the employer, client, or association exceeds one per cent (1%) of the Member's parliamentary salary, then the Member should be required to enter a written agreement that outlines the services to be provided and/or activities to be undertaken. Members should be advised that these agreements should be accessible for the purpose of investigating any matter relating to a Member's secondary employment. The Assembly should determine how and with whom these agreements are to be deposited so that they are accessible for the purposes of investigation if required.
The pecuniary interests register should specify whether the secondary employment reaches the threshold of requiring a written agreement with the employer, and if so the date the agreement was entered into. Members should be required to enter into such agreements within 21 days of agreeing to the secondary employment.
RECOMMENDATION 10 - UPDATING THE REGISTER OF PECUNIARY INTERESTS
That Members of the NSW Parliament be required to register any new interests, or changes in current interests, within 30 calendar days of the new interest commencing or a current interest being amended.
That the register of pecuniary interests be updated within seven days of receipt of documentation of a new interest or amendment to a current interest and that those changes be tabled in the Parliament at the commencement of the next sitting period.
RECOMMENDATION 11 - ESTABLISHMENT OF ELECTRONIC DATABASE OF THE REGISTER OF PECUNIARY INTERESTS
That the register of pecuniary interests be established as an electronic database that can be accessed via the Internet by Members of Parliament and members of the public.
RECOMMENDATION 12 - REVIEW OF FORMS UNDER SCHEDULE 1 OF THE REGULATION
That in undertaking a review of the pecuniary interests register, that a new form be developed to allow Members to advise of a material change in interests, and that the current forms under Schedule 1 be redesigned to improve usability.
RECOMMENDATION 13 - PROCEDURE TO DEAL WITH PARTICULAR ALLEGATIONS
That the New South Wales Legislative Assembly set down in procedure outlining the action it would consider to deal with a serious allegation of the breach of the Code of Conduct and/or of the pecuniary interests register where parliamentary privilege protects the conduct from investigation by the Independent Commission Against Corruption (ICAC).
The ICAC recommends two options:
Option 1: Amendment to the Independent Commission Against Corruption Act 1988 (ICAC Act) to allow the Parliament to waive parliamentary privilege for specific matters which are referred to the ICAC by resolution of the House (although such an amendment would most likely only extend to those Members who choose to give evidence to the ICAC on a voluntary basis).
Option 2: The appointment of an officer of the Parliament on a case-by-case basis to investigate particular matters. The following provisions should be included in the procedure to safeguard the independence of the investigating official:
· The official should be appointed by means of a vote of the Assembly, with at least two thirds of the Members approving the appointment of the official.
· The official should be appointed for the purposes of investigating a particular matter and be subject to removal only upon a vote of the Assembly where any of the conditions for removal or vacation of the office of Commissioner of the ICAC have been met.
· To ensure the independence of the official, that person should not hold any other office of profit under the Crown, other than a pension or similar annuity.
· Once the official has received the reference for the investigation from the House, the official shall be subject only to such direction or instruction from the House as is necessary to efficiently conduct the investigation. It should be made clear that it is improper for the House, or any Member, to direct or attempt to direct the official so as to influence the outcome of the investigation.
· The official should be given the powers and resources of the Parliament as are necessary to adequately carry out the investigation and these should be stipulated in the terms of appointment. At a minimum, it would be expected that the official would have the power to order the production of papers and documents, and compel the attendance of witnesses, and to take evidence in accordance with parliamentary powers, subject to any general limits imposed by the Legislative Assembly at the time of appointment.
· Where the official finds a breach has occurred, the official shall make a recommendation as to what sanction should be imposed by the House.
· The official should be required to provide his or her findings in a written report to the Assembly, which shall be tabled and made publicly available. The report should describe the investigation undertaken by the official, and would give the official the opportunity to report on any efforts to improperly direct or influence the direction or outcome of the inquiries undertaken.
In cases where the conduct of the investigation by the official, or the findings of the official are contested, that the House consider the appointment of an investigatory panel, similar to that of the British House of Commons.
RECOMMENDATION 14 - IMPLEMENTATION OF RECOMMENDATIONS
That the New South Wales Legislative Assembly determine the most effective means of implementing the recommendations in this report - either by legislative amendment or by way of resolution of the House.
This report has been prepared in response to a resolution of the New South Wales Legislative Assembly (the Assembly) requesting the Independent Commission Against Corruption (ICAC) to review the Code of Conduct for that House in respect of limiting secondary employment in the field of `public affairs'.
The events leading to the resolution began with the publication of a newspaper article that stated that the Opposition Leader, the Hon. John Brogden MP, was engaged in secondary employment as a `public affairs' consultant and alleged that he had asked questions in the Parliament that could have furthered the interests of his employer.1 This led to a series of media articles2 and was the subject of a number of debates in the Assembly3 which resulted in the resolution described below.
This chapter begins by providing a description of the resolution and how the ICAC has responded to it. The remaining sections set out the methodology undertaken to inform the preparation of this report, and describe the scope and structure of this report.
The resolution of the NSW Legislative Assembly
On 14 November 2002, a censure motion against Mr Brogden was moved and debated in the Legislative Assembly.4 It subsequently passed along party lines. On 21 November, 2002, the Assembly resolved:
That, having regard to the issues raised in the debate in the censure motion in the Legislative Assembly on 14 November 2002 and to subsequent questions relating to the conduct of the Hon. John Brogden MP, Leader of the Opposition, the member for Pittwater, the House requests the Independent Commission Against Corruption (ICAC) to look into those matters and report to the Speaker as soon as practicable on what measures might be taken in respect of regulating or limiting the employment of members of Parliament to provide advice on public affairs.
In particular, the House requests the ICAC to consider the adequacy of the provisions of the Code of Conduct for Members of the Legislative Assembly.
In respect of the above, the ICAC should specifically consider provisions in:
a) the United Kingdom House of Commons Code of Conduct and Guide to the Rules Relating to the Conduct of Members, which:
· require the nature of any post held by a member to be properly described, for example, as a `legal adviser' `or parliamentary and public affairs consultant;
· require a written contract of engagement to be disclosed, together with details of all clients to whom the member provides advice, where the provision of services depends upon, or arises out of, the member's position as a member; and
· prohibit `advocacy' whereby a member receives a direct or indirect benefit to advocate or initiate any cause or matter in proceedings in Parliament specifically on behalf of an outside body, where such action would confer an exclusive benefit on that body;
b) the Code of Conduct for Members of the Scottish Parliament, which:
· prohibits advocacy for a fee in proceedings in Parliament;
· directs that a member should not accept any paid work which would involve the member in lobbying on behalf of any person or organisation or any clients of a person or organisation;
· directs that a member should not accept any paid work to provide services as a parliamentary strategist, adviser or consultant, for example, in advising on parliamentary affairs or how to influence the Parliament and its members and
c) any other relevant provisions in other jurisdictions.5
Part 1 of the resolution
The Assembly's resolution may be interpreted, in part, as a request for the ICAC to use its statutory powers to investigate Mr Brogden's conduct in this matter.
The Commissioner of the ICAC responded to the Speaker of the Legislative Assembly on 16 December 2002 concerning this potential interpretation of the resolution. The letter stated that the ICAC does not have the statutory authority to investigate matters where parliamentary privilege applies. The Commissioner explained the jurisdiction of the ICAC in the following way:
The rights, privileges and immunities of the NSW Parliament are governed by the Bill of Rights 1688 (UK) which has authority in NSW by virtue of the Imperial Acts Application Act 1969. Article 9 of the Bill of Rights states that:
the freedom of speech, or debates or proceedings in Parliament ought not
to be impeached or questioned in any court or place out of Parliament.By way of clarification of what might be meant by `impeached or questioned' it has been held that provisions such as Section 16(3) of the Parliamentary Privileges Act 1987 (Cth) provides some guidance. It states:
In proceedings in any court or tribunal, it is not lawful for evidence to be tendered or received, questions asked or statements, submissions or comments made, concerning proceedings in Parliament, by way of, or for the purpose of:
(a) questioning or relying on the truth, motive, intention or good faith of anything forming part of those proceedings in Parliament;
(b) otherwise questioning or establishing the credibility, motive, intention or good faith of any person; or
(c) drawing, or inviting the drawing of, inferences or conclusions wholly or partly from anything forming part of those proceedings in Parliament...
Section 122 of the [ICAC] Act specifically preserves the `privileges of Parliament with respect to the freedom of speech, and debates and proceedings, in Parliament'. The resolution of the Legislative Assembly does not address any waiver of the privileges of the House with respect to its request that the ICAC look into the matters raised...the [ICAC] Act contains no special statutory provisions, such as those contained in Part 4A of the Special Commissions of Inquiry Act 1983, permitting the House to waive its privileges. In the absence of specific statutory authority, it appears [the ICAC] has no power to investigate matters which involve the motivation of Members asking questions in the Parliament.
To the extent that the resolution suggests that the conduct of Mr Brogden be investigated, that part has been dealt with and the conduct of Mr Brogden is not given further consideration in this report.
Part 2 of the resolution
The remainder of the resolution can be addressed within the ICAC's jurisdiction and is the subject of this report.
Methodology
A number of approaches were used to obtain information to assist in preparing this report. They are set out below.
Review of the model of regulation of parliamentary standards in other jurisdictions
In being asked to consider the necessity for regulation or limitation on Members' secondary employment in the area of providing `public affairs' advice, the ICAC has been asked to give particular consideration to the situation in the British House of Commons and the Scottish Parliament.
Both parliaments undertook inquiries prior to the establishment of their respective current arrangements, and have been the subject of subsequent review by parliamentary committees, and in the case of Scotland, by the courts. The models adopted by these two parliaments are considered and discussed.
To consider whether appropriate models existed elsewhere, examination was also made of the situation in other jurisdictions, including Ireland, Wales, Northern Ireland and other Australian parliaments.
A review of these additional jurisdictions identified a number of issues that affected the relevance or usefulness of any comparison for this report. For instance:
· The Irish Parliament (the `Oireachtas') did not adopt the UK style of parliamentary privilege after the establishment of the Irish state in 1922. Consequently its system has tended to evolve away from the Westminster-style system in operation in NSW.
· The regulation of parliamentary standards in Wales has been hampered by the lack of primary legislative power for the Welsh Assembly (which can only effect changes to the Standing Orders). Furthermore, the Welsh Assembly has been reviewing its regulation of parliamentary standards.6
Other Australian parliaments were not included in this report because they tend to have schemes similar to that operating in New South Wales.* However, two other parliaments were considered to offer variations or alternatives to the British House of Commons and the Scottish Parliament; the Ontario Legislative Assembly and the Canadian House of Commons. They are discussed in Chapter 5 of the report.
* A useful summary of the provisions in Australian parliaments concerning disclosure of Members' pecuniary interests can be found in Appendix 3 of the Report on inquiry into the Pecuniary Interests Register 2002, Standing Committee on Parliamentary Privilege and Ethics, Parliamentary Paper Number 218, Parliament of New South Wales
Review of the literature
The literature reviewed includes the reports, submissions and research papers prepared by various committees that have an interest in the area. The following sets out each committee, the jurisdiction it operates in, and its role and purpose.
Jurisdiction |
Committee |
Role and Purpose |
UK - House of Commons |
The Committee on Standards and Privileges |
Appointed by the House of Commons to: - oversee the work of the Parliamentary Commissioner for Standards - recommend any modifications to the Code of Conduct as may from time to time appear to be necessary.7 |
UK Parliament |
Committee on Standards in Public Life |
Established in 1994 by the then Prime Minister to examine current concerns about standards of conduct of all holders of public office, including arrangements relating to financial and commercial activities, and make recommendations as to any changes in present arrangements which might be required to ensure the highest standards of propriety in public life. 8 The current Prime Minister, the Rt Hon. Tony Blair MP, has extended this term of reference to enable the Committee to undertake an enquiry into the funding of political parties.9 |
Scottish Parliament |
Standards Committee |
Appointed by the Parliament to consider and report on: -whether a Member's conduct is in accordance with the Rules and any Code of Conduct for Members, matters relating to the conduct of Members in carrying out their parliamentary duties -the adoption, amendment and application of any Code of Conduct for Members.10 |
NSW Legislative Assembly |
Standing Committee on Ethics |
The Committee has the following functions: - to prepare for consideration by the Legislative Assembly draft Codes of Conduct for Members of the Legislative Assembly and draft amendments to Codes of Conduct already adopted - to carry out educative work relating to ethical standards applying to Members of the Legislative Assembly - to give advice in relation to such ethical standards in response to requests for advice by the Legislative Assembly, but not in relation to actual or alleged conduct of any particular person.11 |
NSW Legislative Council |
Standing Committee on Parliamentary Privilege and Ethics (note: this Committee is yet to be reconstituted in the current Parliament). |
The Committee has the following functions: - to consider and report on matters relating to parliamentary privilege referred to it by the House of the President - to carry out certain functions relating to ethical standards for members of the Legislative Council - to consider certain submissions from citizens seeking a right of reply to statements made about them in the House.12 |
NOTE: All publications referred to are fully referenced in the endnotes to each chapter.
Request for comments from Members of the NSW Legislative Assembly
It was considered relevant to provide MPs with the opportunity to comment on the issues raised by the resolution of the House. In December 2002 the Commissioner wrote to all 93 Members of the Legislative Assembly of the 52nd Parliament inviting their responses to the following questions:
1. What do you understand to be professions or professional activities employed to provide advice on `public affairs'?
2. In light of your understanding of the concept of `public affairs', are you or have you ever been, whilst a Member of Parliament, employed or engaged in any capacity relating to `public affairs'?
3. Do you believe the present Code of Conduct applying to Members of your House to be adequate in its handling of issues relating to the secondary employment of Members of Parliament in the `public affairs' field? If no, why not? What improvements would you suggest be made to the Code of Conduct in this respect?
4. Are there any other issues relating to this matter you believe should be considered by the ICAC?
Twenty-three responses were received. These included responses from the Premier and the Leader of the Opposition, the Leader of the National Party, the Deputy Premier, current and former Ministers, and backbenchers from the Government, Opposition and Crossbench. A detailed breakdown of the responses is provided in Appendix A.
Scope and structure of the report
As the resolution was referred by - and contains references to - Members of the Legislative Assembly, only the position of Members of that House is considered and discussed. However, it is noted that the former Legislative Council Standing Committee on Parliamentary Privilege and Ethics, in its report on the review of the Code of Conduct, stated that it would consider any recommendations made by the ICAC in this report.13
The following three chapters describe models of regulation of parliamentary standards in respect of secondary employment and related conflicts of interest in the NSW Legislative Assembly, the British House of Commons and the Scottish Parliament. Each chapter begins with a historical account of the events that have led to the current model. As none of the models has particular provisions to deal with providing advice in `public affairs', each model as it generally applies to all forms of secondary employment and related conflicts of interests is described.
Chapter 5 sets out the practices of two other jurisdictions, the Legislative Assembly of Ontario and the Canadian House of Commons. Both are Westminster-style parliaments that have models that are similar in some respects to those of Britain and Scotland, but which differ in some significant respects. This chapter focusses on the differences in the Canadian models that are relevant to the topic of this report.
The final chapter, Chapter 6, discusses potential reform for the Assembly in consideration of the experiences of other jurisdictions and of the particular situation of the Assembly. A number of recommendations are made.
It should also be noted that the models used in other jurisdictions reviewed by the ICAC are complex and detailed, and they cover issues and conflicts well beyond just those relating to secondary employment, for example:
Sponsorship - the UK model requires disclosure of any donation received by a Member's constituency association which is linked either to candidacy at an election or to membership of the House, as well as disclosure of any other form of financial or material support as an MP.
Election expenses - the Scottish model defines contributions towards the election expenses of a member as a registrable interest.
Gifts, benefits and hospitality - the UK model requires disclosure of any gift to the Member or the Member's partner, or any material benefit, of a value greater than one per cent (1%) of the current parliamentary salary from any company, organisation or person within the UK which in any way relates to their role as an MP. The Scottish model extends the disclosure provision in relation to gifts to a cohabitee or a company in which the member has controlling interest or a partnership.
Overseas visits - the UK model requires disclosure of all overseas visits by the Member or Member's partner, relating to or in any way arising from their position as an MP, and where the cost of the visit was not wholly borne by the Member or by UK public funds. Overseas benefits and gifts must also be disclosed.
Shareholdings - the UK model requires disclosure of all shares, including those held with or on behalf of the Member's partner or children. The Scottish Model also requires disclosure of shares held by partners.
In addition, several models have complex definitions of benefits, so as to include benefits beyond just income. For example, the Scottish model defines remuneration as including salary, wage, share of profits, fee, expenses, other monetary benefit or benefit in kind. This definition includes benefits such as the provision of a company car or travelling expenses by an employer.14
It is beyond the scope of this report to delve into those areas beyond the issue of secondary employment, however it is important to recognise that these models are complex and detailed, and have been designed to deal with all types of actual and potential conflicts of interest, including secondary employment, in a collective and holistic way.
Chapter 1 endnotes
1 Totaro, P. & Wainwright, R. 2002. `Brogden acted as $110,000 consultant', Sydney Morning Herald, 13 November, p. 1.
2 Totaro, P. & Wainwright, R. 2002. `Buckets of mud as bearpit censures Brogden', Sydney Morning Herald, 15 November, p.1.
Sydney Morning Herald 2002. `Brogden misses the point', 15 November, p. 14.
Lipari, K. 2002. `Two-job Johnny in parliamentary hot seat', Daily Telegraph, 15 November, p. 13.
Hepworth, A. 2002. `Brogden denies allegations', Financial Review, 15 November, p. 15.
Sun Herald 2002. `Voters held in contempt', 17 November, p. 20.
Hepworth, A. 2002. `Brogden accuses Carr of smear tactics', Financial Review, 15 November, p. 5.
Horan, M. 2002. `Brogden may face ICAC', Sunday Telegraph, 17 November, p. 1.
Horan, M. 2002. `Carr seeks ICAC inquiry', Sunday Telegraph, 17 November, p. 5
Totaro, P. & Wainwright, R. 2002. `Carr to ban politicians' sponsorship', Sydney Morning Herald, 16-17 November, p. 7.
Lipari, K. 2002. `Brogden's silence will only deepen suspicion', Daily Telegraph, 18 November, p. 19
Ellicott, J. 2002. `Brogden blasts cash accuser in the park', The Australian, 20 November, p. 6.
Hepworth, A. & AAP. 2002. `Brogden confronts accuser over "gutter" allegations', Financial Review, 20 November, p. 14.
Lipari, K. 2002. `Brogden to Refshauge: You, Sir, are a coward', Daily Telegraph, 20 November, p. 7.
Totaro, P. & Wainwright, R. 2002. `Brogden, Refshauge face off as "cash for questions" boils over', Sydney Morning Herald, 20 November, p. 4.
Lipari, K. 2002. `ICAC to check on MPs' outside work', Daily Telegraph, 22 November, p. 2.
Totaro, P. & Wainwright, R. 2002. `ICAC called as Labor tries to tarnish Brogden's consultancy gold', Sydney Morning Herald, 22 November, p. 8.
Financial Review 2002. `Brogden referred to ICAC', 22 November, p. 24
Horan, M. 2002. `Brogden defence in question', Daily Telegraph, 24 November, p. 19.
3 Hansard. NSW Legislative Assembly. 13 November 2002, p. 6679.
Hansard. NSW Legislative Assembly. 14 November 2002.
Hansard. NSW Legislative Assembly. 19 November 2002.
Hansard. NSW Legislative Assembly. 20 November 2002.
Hansard. NSW Legislative Assembly. 21 November 2002, p. 7406.
4 Hansard. NSW Legislative Assembly. 14 November 2002.
5 Hansard. NSW Legislative Assembly. 21 November 2002.
6 Committee on Standards in Public Life. The Regulation of Parliamentary Standards - A Comparative Perspective. May 2002. Research paper prepared by Oonagh Gay.
7 Source: http://www.parliament.uk/parliamentary_committees/standards_and_privileges.cfm
8 Hansard. United Kingdom House of Commons. 25 October 1994.
9 Committee on Standards in Public Life (Chair: Sir Nigel Wick). Standards of Conduct in the House of Commons. November 2002. Eighth Report. Cm 5663.
10 Source: www.scottish.parliament.uk/standards/index.htm
11 Source: www.parliament.nsw.gov.au/prod/web/phweb.nsf/frames/committees?open&tab=committees
12 Source: www.parliament.nsw.gov.au/prod/web/phweb.nsf/frames/committees?open&tab=committees
13 Legislative Council Standing Committee on Privileges and Ethics. Report on Review of the Members Code of Conduct. December 2002. p. 18.
14 British House of Commons. The Code of Conduct for Members of Parliament and The Guide to the Rules relating to the Conduct of Members.
Source: http://www.parliament.the-stationery-office.co.uk/pa/cm200102/cmselect/cmstand/841/84101.htm
Scottish Parliament. Code of Conduct for Members of the Scottish Parliament. Revised 01-05-03. Source: www.scottish.parliament.uk/msps/coc/coc-c.htm
CHAPTER 2 - REGULATION OF SECONDARY EMPLOYMENT
This chapter provides a historical overview of the current framework of regulation of parliamentary standards in place in the NSW Legislative Assembly. This is followed by a section outlining each component of that framework: Code of Conduct, register of disclosures, Standing Committee on Ethics and the Parliamentary Ethics Adviser. The means of dealing with breaches of the Code and the register of disclosures are also discussed.
Historical events leading to current framework of regulation
The NSW Parliament's first step towards dealing with and managing MPs' pecuniary interests, including those that may relate to secondary employment, was the appointment of a joint parliamentary committee in 1976 to inquire as to whether a register of pecuniary interests was needed. The Committee recommended the establishment of a register for the Members of each House, to be compiled and maintained by the Clerk of the respective House, with oversight by a joint parliamentary committee. 15
In November 1979 both Houses of Parliament passed resolutions to establish a pecuniary interests register for each House, and a committee in each House to administer the register and consider complaints. However, doubts were raised about the implementation of registers because of the uncertainty as to the power of the Houses to punish for contempt. Legal advice obtained by the Government stated that `the Parliament could only vest the Legislative Assembly with the power to punish for contempt by legislation (not by resolution), and that it could only vest the Legislative Council with such power by legislation approved at a referendum'. 16
Consequently both resolutions were rescinded, and in 1981 the then Premier introduced the Constitution (Disclosures by Members) Amendment Bill that included a proposal to insert what is now Section 14A of the Constitution Act 1902 (the Constitution Act). The Bill provided for the Governor to make regulations with respect to disclosures of a range of pecuniary interests, including incomes and positions held*. It also made provisions giving power to both Houses to declare a Member's seat vacant if the Member wilfully contravened a regulation made under that section. Following the passage of this Bill the Constitution (Disclosures by Members) Regulation 1983 (the Regulation) was introduced. The Regulation sets out the detail of the disclosure scheme.
In 1988 the Legislative Council established, by way of a resolution, the Standing Committee on Parliamentary Privilege. This Committee was later reconstituted in 1995 as the Committee on Parliamentary Privilege and Ethics. The Legislative Assembly did not establish an equivalent committee at this time.
Also in 1988, the ICAC was established by statute to investigate `corrupt conduct' by NSW public officials, including MPs. In 1992, the ICAC investigated what became known as the `Metherell affair', which centered on the resignation of Dr Terry Metherell from the Parliament to take up a senior public service position. The investigation and subsequent decision of the NSW Court of Appeal in Greiner v Independent Commission Against Corruption (1992)17 resulted in some debate concerning the ICAC's jurisdiction over Ministers of the Crown.
* The Bill was passed by both Houses of Parliament on 12 May 1981, and was approved at a referendum held on 19 September 1981. The Bill came into force in 1982.
As a consequence, the Independent Commission Against Corruption (Amendment) Act 1994 was passed and resulted in:
· The definition of `corrupt conduct' being altered to include `in the case of conduct of a Minister of the Crown or a Member of a House of Parliament - a substantial breach of an applicable code of conduct' (s. 9(1)(d) of the ICAC Act);
· Both Houses of Parliament being required under the Act to each establish a committee to draft a Code of Conduct for their respective House, to carry out educative work relating to ethical standards and to provide advice in relation to such ethical standards in response to requests from the respective House (Part 7A of the ICAC Act).
In 1995 the Legislative Council resolved that the Standing Committee on Parliamentary Privilege and Ethics would be the `designated committee' to review the Code of Conduct at least once every two years for that House.18
After considerable consultation and debate the Legislative Assembly adopted - by way of resolution - a Code of Conduct on 5 May 1998.19 The Code is adopted by way of resolution at the commencement of each Parliament. The Legislative Assembly Standing Committee on Ethics was also established in 1998. In September of that year both Houses of the Parliament resolved to appoint a part-time Parliamentary Ethics Adviser.20
In 2002, both the Legislative Assembly Standing Committee on Ethics and the Legislative Council Standing Committee on Parliamentary Privilege and Ethics conducted a review of the current Code of Conduct21 (the Houses have adopted identical Codes). Neither Committee recommended changes relevant to the topic of this report and so they are not considered any further.
Current framework of regulation
The framework for regulating and managing secondary employment within the NSW Legislative Assembly has a number of components: the Code of Conduct, the register of pecuniary interests, the Legislative Assembly Standing Committee on Ethics and the Parliamentary Ethics Adviser.
Code of Conduct
The Code (see Appendix B) is established by way of resolution of the House and can be described as aspirational rather than prescriptive. The Code does, however, operate:
...in a strict legal context, forming part of the definition of `corrupt conduct' within the ICAC Act. In this context, a `substantial breach' of the Code may result in a finding of `corrupt conduct' by the ICAC.22
The Code does not prohibit any form of secondary employment but does include a statement under the heading of `Bribery':
Members must not promote any matter, vote on any bill or resolution, or ask any question in the Parliament or its Committees, in return for payment or any other personal financial benefit.
The Code does not otherwise deal with the specific issue of paid advocacy.
The Code does require disclosure of pecuniary conflicts of interest:
(a) Members of Parliament must take all reasonable steps to declare any conflict of interest between their private financial interests and decisions in which they participate in the execution of their office.
(b) This may be done through declaring their interests on the Register of Disclosures of the relevant House or through declaring their interest when speaking on the matter in the House or a Committee, or in any other public and appropriate manner.
(c) A conflict of interest does not exist where the member is only affected as a member of the public or a member of a broad class.
Where secondary employment income is directly paid to the Member, and where this may conflict with the Member's parliamentary duties, the Code clearly requires some type of declaration. In the NSW Parliament, the policy and procedure for making such declarations is set out in the pecuniary interests register, discussed later in this chapter.
Breaches of the Code of Conduct
In terms of enforcement of the Code and investigation of breaches that may relate to secondary employment, the corrupt conduct jurisdiction of the ICAC extends only to `substantial breaches' of the code although to date `substantial breach' has not been formally defined.
The ICAC's assessment of what constitutes a `substantial' breach of the Code will depend on the facts and circumstances of each particular case. The word `substantial' is given its natural and ordinary meaning. The Shorter Oxford English Dictionary defines `substantial' inter alia `as being of ample or considerable amount, quantity or dimensions; having weight or force or effect, not of imaginary, unreal or apparent only'. 23 Similarly the Butterworths Australian Legal Dictionary defines the term as `being real or of substance, as distinct from ephemeral or nominal; in a relative sense, considerable'.24
The ICAC is of the view that the meaning should also be considered in the overall context in which the term is used. The Preamble to the Code refers to the responsibility of MPs to perform their duties with honesty and integrity, respecting the law and the institution of Parliament. What constitutes a `substantial' breach will also be influenced by which clause of the Code a Member is alleged to have breached. For example a single instance of a breach of clause 2 (which deals with bribery) may amount to a `substantial' breach, whereas a single instance of a breach of clause 4 (dealing with the use of public resources) may not be regarded as a `substantial' breach. Other factors to consider may include the amount of money or value of gifts involved, whether the conduct could also amount to a criminal offence, the nature and extent of a failure to declare a conflicting interest and the assessment of that conduct by other Members.
If the ICAC has undertaken an investigation into a Member for corrupt conduct which could amount to a `substantial' breach of the Code of Conduct, it may report its finding to the Parliament. The ICAC can make a finding of corrupt conduct as defined in the Independent Commission Against Corruption Act 1988 (ICAC Act) although there are no penalties associated with such a finding. If the conduct could amount to a criminal offence, the ICAC can recommend that the Director of Public Prosecution consider prosecution.
Ultimately, it is a matter for the House, as a self-regulating authority, to determine how to deal with a Member who has been shown to have committed a `substantial' breach of the Code. The Assembly is limited in what action it can take against a Member in such circumstances - it can take action so as to preserve the integrity of the House but cannot take action to punish the Member.25 To preserve the integrity of the House, the Assembly can expel a Member under Standing Order Number 294 (Disorder - expulsion)*:
A Member adjudged by the House guilty of conduct unworthy of a Member of Parliament may be expelled by vote of the House, and the seat declared vacant.26
More serious breaches that are also a criminal offence are dealt with under section 13(A) of the Constitution Act 1902:
(1) If a Member of either House of Parliament:...
...
(e) is convicted of an infamous crime, or of an offence punishable by imprisonment for life or a term of 5 years or more, and is the subject of the operation of subsection (2),
his seat as a Member of that House shall thereby become vacant.
(2) For the purposes of subsection (1)(e), a Member is the subject of the operation of this subsection if:
(a) the Member has not lodged an appeal against the conviction within the prescribed period, or
(b) the conviction has not been quashed on the determination of an appeal or appeals lodged within the prescribed period, or
(c) such an appeal has been lodged within the prescribed period but has been withdrawn, or has lapsed, without being determined, and no other appeal lodged within the prescribed period is pending.
(3) Nothing in this section affects any power that a House has to expel a Member of the House.
As noted at the beginning of this report, in the case where an allegation of a breach of the Code involves conduct that is protected by parliamentary privilege, the ICAC does not have the jurisdiction to investigate. In this case it is for the House to deal with the allegation.
The House can establish a committee to investigate such matters under Standing Order 329:
A committee shall have the power to send for persons, papers, records and exhibits.
Standing Order 348 allows the committee to make a report and recommend action to be considered by the House:
If any measure or proceeding be necessary upon a committee report it shall be considered by the House by motion on notice.27
The alternative option for the Parliament to deal with a specific allegation relating to or arising from proceedings in Parliament (which are protected by parliamentary privilege), and arguably only in the most serious cases, is to establish a Commission of Inquiry under the Special Commissions of Inquiry Act 1983. This course of action, however, immediately raises the question of whether the Commission of Inquiry can actually rely on, let alone investigate, the proceedings in Parliament.
* Standing Orders can be accessed via www.parliament.nsw.gov.au/prod/web/phweb.nsf/frames/Legislative Assembly?open
There appears to be general agreement that parliamentary privilege can only be waived by amendment to legislation and not solely by a resolution of the House.28
A case in point arose from allegations made in the NSW Legislative Council in 1997 by the Hon. Franca Arena MLC, then a Member of the Council. She made serious allegations in the House suggesting that a number of public figures had made secret arrangements to prevent names becoming public which might be subject of inquiry at a Royal Commission.
A Special Commission of Inquiry was established, but it soon became apparent that the Special Commission could be prevented from dealing with the matters raised by Ms Arena, because she had made these allegations only in the Parliament, and parliamentary privilege barred the Special Commission from pursuing the allegations as made.
The Solicitor General issued advice stating that, having regard to the limitations imposed by Article 9 of the Bill of Rights:
It is our view that the power conferred upon the Governor is so limited, with the consequence that section 4(1)(a) of the Special Commissions of Inquiry Act does not confer upon the Governor a power to issue a commission to inquire into a matter when an inquiry into that matter would amount to the impeaching or questioning of something said in a House of the New South Wales Parliament.29
To address this bar, the Parliament passed the Special Commissions of Inquiry Amendment Act 1997 to allow a House of Parliament to waive parliamentary privilege by resolution in connection with inquiries of a particular kind. The 1997 Amendment Act included a sunset clause so that the amendment expired six months after commencement, and these provisions no longer have effect.
Under the 1997 amendments to the Special Commissions of Inquiry Act, a House could waive its parliamentary privilege and could authorise a Member to voluntarily give evidence before a Special Commission set up under the 1983 Act without being in breach of parliamentary privilege. However, the statute did not operate to waive parliamentary privilege to the extent that an individual Member could not assert it. The effect was that a MP could decline to answer questions before a Special Commission on the basis of parliamentary privilege, and could do so legitimately and lawfully.
In essence, the amendments allowed a Special Commission of Inquiry to investigate allegations made in Parliament, permitted Members of Parliament to give evidence to such an inquiry should they wish to do so, but it could not compel Members to give evidence where they chose not to.
Ms Arena unsuccessfully challenged the amendments. Ultimately, the Special Commission of Inquiry proceeded to examine Ms Arena's allegations, and Ms Arena chose not to give evidence to it.
The question of whether parliamentary privilege could be waived in such a way that could compel an uncooperative member to give evidence to such an inquiry remains untested and there are differing opinions on the topic.30 As the 1997 Amendments have expired, at the present time no court or tribunal has the power to rely upon or investigate matters arising from the proceedings of the NSW Parliament.
The Register of Disclosures by Members of the Legislative Assembly
The main instruments governing the declaration and registration of pecuniary interests are Section 14A (see Appendix C) of the Constitution Act 1902 (the Constitution Act), which gives the Governor the power to make regulations relating to the registration of Members' pecuniary interests and other matters, and the Constitution (Disclosures by Members) Regulation 1983 (the Regulation). These statutory provisions apply to both Houses of the Parliament.
The relevant clauses of the Regulation are provided in Appendix D, but in summary Members are required to make disclosures relating to the following:
· real estate
· income from any source
· gifts
· contributions to travel
· interests and positions in corporations (whether remunerated or not)
· positions in trade unions and professional or business associates
· debts
· dispositions of property.
Disclosure requirements do not extend to family members and do not include non-pecuniary conflicts of interest although under Clause 16 of the Regulation, a Member may, at his or her discretion, disclose any direct or indirect benefits, advantages or liabilities, whether pecuniary or not.
Clause 9(2) of the Regulation requires Members to register the following information regarding income:
(a) in relation to income from an occupation of the Member:
(i) a description of the occupation;
(ii) where the Member is employed or the holder of an office - the name and address of his employer or a description of the office; and
(iii) where the Member has entered into a partnership with other persons - the name (if any) under which the partnership is conducted
(b) in relation to income from a trust - the name and address of the settlor and the trustee; or
(c) in relation to any other income - a description sufficient to identify the person from whom, or the circumstances in which, the income was, or is reasonably expected to be, received.
Income need not be disclosed if the amount of the income received, or reasonably expected to be received, does not exceed $500.
For interests and positions in corporations, a Member is required to disclose the name and address of the corporation, the nature of interest or description of the position held, and, except in the case of a public company, a description of the principal objects of the corporation. Under Clause 12(2) of the Regulation, disclosure is not required if the corporation is:
· formed for the purpose of providing recreation or amusement or promoting commerce, industry, art, science, religion or charity or for any other community purpose
· required to apply its profits or other income in promoting its objects
· prohibited from paying any dividends to its members.
For positions in trade unions and professional or business associations, Members are to provide the name of each trade union and each professional or business association in which he or she holds any position (whether remunerated or not), and a description of the position held.
The Regulation requires two types of returns (i.e. disclosures) - primary returns and ordinary returns. The primary return is the first return made by a Member and is required within three months after becoming a Member of Parliament. Ordinary returns refer to an annual return usually for the period ending 30 June of each year and due to the Clerk of the House by 1 October each year (Clauses 5 and 6). The forms to be used for the primary and ordinary return are provided in Schedule 1 of the Regulation (see Appendix E). If there is insufficient space on the form to make all declarations, the Member is required to attach a signed appendix.
The information on the returns constitutes the register of interest, which is maintained by the respective Clerk of each House. If Members' interests change during the course of the period, they are not able to alter their declaration. Where Members want to make a declaration during the period, they are usually advised by the Clerks that it is not possible to alter or update their declaration, but that a copy of their letter advising the changes can be filed alongside their declaration.
The register is open to public inspection at the office of the relevant Clerk. The register itself is a loose-leaf compilation of the declaration forms submitted by Members, consequently it is not available electronically nor is it able to be accessed via the Internet. After each reporting period (i.e. annually) the Clerk is to table, within 21 sitting days of the Assembly, a copy of that part of the register which has not been previously tabled. At the end of each financial year, the Clerk also publishes the register and the Office of the Clerk makes paper copies available to members of the public.
Breaches of the Regulation (Pecuniary Interests Register)
If there is a suspected breach of the Regulation, the provisions discussed in the earlier section on breach of the Code of Conduct apply. It is worth noting that this situation differs to that in the NSW Legislative Council which also has a Standing Committee which can and does investigate breaches of the Regulation by Members of that House.
A breach of the Regulation does not attract any criminal or civil liability, however, if a Member is found to have `wilfully' contravened the Regulation the respective House may declare his or her seat vacant. To date there has been no instance of a Member's seat being declared vacant for this reason.
Legislative Assembly Standing Committee on Ethics
The functions of this Committee are:
(a) to prepare for consideration by the Legislative Assembly draft codes of conduct for members of the Legislative Assembly and draft amendments to codes of conduct already adopted, and
(b) to carry out educative work relating to ethical standards applying to members of the Legislative Assembly, and
(c) to give advice in relation to such ethical standards in response to requests for advice by the Legislative Assembly, but not in relation to actual or alleged conduct of any particular person.31
The Committee currently has eight members, comprising five members from the Labor Party, two members from the Liberal Party, and one member from the National Party. The Chair and Vice Chair are both from the Labor Party. 32
Since its establishment in 1998, the Committee has produced four reports including a review of the current Code of Conduct.
Parliamentary Ethics Adviser
The Parliamentary Ethics Adviser33 is a part-time appointment of the Parliament with the function to advise MPs on ethical issues concerning their role as Members of Parliament. This advice includes the use of entitlements and potential conflicts of interest. The Code of Conduct and any other relevant guidelines adopted by the House guide the Adviser in providing advice. The Parliamentary Ethics Adviser's role does not include the giving of legal advice or conducting inquiries or investigations into the conduct of MPs. 34
The Adviser is required to keep records of advice given and the factual information upon which it is based. The Adviser has a duty to maintain the confidentiality of the information provided to him or her in that role and the advice given. However, the Adviser may make advice public if the Member who requested the advice gives permission for this. The NSW Legislative Assembly will only call for the production of records of the Parliamentary Ethics Adviser if the Member to which the records relate has sought to rely on the advice of the Adviser or has given permission for the records to be produced to the House.35
The Adviser meets annually with the Legislative Assembly Standing Ethics Committee and the Legislative Council Standing Committee on Parliamentary Privilege and Ethics. The Adviser is required to report annually to the Parliament on the number of ethical matters raised with him or her, the number of members who sought advice, the amount of time spent in the course of his or her duties and the number of times advice was given.36
Chapter 2 endnotes
15 Standing Committee on Parliamentary Privilege and Ethics. Report on inquiry into the Pecuniary Interests Register. Report no. 20. October 2002.
16 ibid. p. 6.
17 Greiner v ICAC (1992) 28 NSWLR 125.
18 Hansard. NSW Legislative Council. 24 May 1995.
19 Hansard. NSW Legislative Assembly. 5 May 1998.
20 Hansard. NSW Legislative Assembly. 23 September 1998.
Hansard. NSW Legislative Council. 24 September 1998.
21 Legislative Assembly Standing Ethics Committee (NSW). Review of the Code of Conduct. June 2002. Standing Committee on Parliamentary Privilege and Ethics (NSW Legislative Council). Report on review of the Members' Code of Conduct. Parliamentary Paper Number 369. December 2002.
22 Standing Committee on Parliamentary Privilege and Ethics (NSW Legislative Council). Report on review of the Members' Code of Conduct. Parliamentary Paper Number 369. December 2002, p. 17.
23 The Shorter Oxford English Dictionary. 1973 (1933). Ed. C. T. Onions. Clarendon Press, Oxford.24 Butterworths Australian Legal Dictionary. 1997. Eds. The Hon. Dr Peter E Nygh & Peter Butt. Butterworths, Australia.
25 Armstrong v Budd (1969) 71 NSWSR 386.
26 Parliament of New South Wales, Legislative Assembly. Standing Rules and Orders. Approved by the Governor, 12 December 1994. Amendments approved, 14 October 1996.
27 ibid.
28 NSW Parliamentary Library Research Service. Parliamentary Privilege: Use, Misuse and Proposals for Reform (by Gareth Griffith). Briefing paper no. 4/97. September 1997.
Donaghue, Stephen. 2001. Royal Commissions and Permanent Commissions of Inquiry. Butterworths, Australia.
Odgers' Australian Senate Practice. Revised to 30 June 2002. Tenth Edition. Ed. Harry Evans. Australian Commonwealth Government.
29 Hansard. NSW Legislative Assembly. 22 November 2002. (Comment by Mr Andrew Tink).
23 September 1997. p. 360.
30 NSW Parliamentary Library Research Service. Parliamentary Privilege: Use, Misuse and Proposals for Reform (by Gareth Griffith). Briefing paper no. 4/97. September 1997.
Donaghue, Stephen. 2001. Royal Commissions and Permanent Commissions of Inquiry. Butterworths, Australia.
Odgers' Australian Senate Practice. Revised to 30 June 2002. Tenth Edition. Ed. Harry Evans. Australian Commonwealth Government.
31 Source: http://www.parliament.nsw.gov.au/prod/web/phweb.nsf/frames/committees?open&tab=committees
32 ibid.
33 Hansard. NSW Legislative Assembly. 22 November 2002.
34 ibid.
35 ibid.
36 ibid.
CHAPTER 3 - BRITISH HOUSE OF COMMONS
The resolution of the Assembly has specifically requested the ICAC to consider the practices in the British House of Commons. As is evident in the following pages, there are considerable differences between the House of Commons and the NSW Legislative Assembly, both in terms of the history leading to establishment of the current model of regulation of parliamentary standards, and also in the detail of those models.
The House of Commons has a more complex and detailed framework that has evolved over time in response to particular issues that the Parliament has been required to deal with. Changes have been made as recently as June 2003 to address aspects of the model that have been problematic or subject to criticism. Nevertheless there are some lessons that can be learnt from the experiences and practices of the House of Commons.
This chapter provides a historical overview of the current framework of regulation of parliamentary standards in the House of Commons, then outlines how each component of the current framework operates. These components are the Code of Conduct and The Guide to the Rules relating to the Conduct of Members (the guide)37; Register of Members' Interests; Parliamentary Commissioner for Standards; Committee for Standards and Privileges; and the investigation process for breaches.
Historical events leading to current framework of regulation
The scandals surrounding financial, sexual and other misconduct by UK MPs during the 1980s and particularly the early 1990s created a crisis of confidence in the integrity of MPs and of the Parliament itself. The events and environment of that time have been described as follows:
10. Claims that the highest public standards were not being adhered to were made on occasion during the 1980s; but in the early 1990s there was a spate of such accusations ... Taken together, they seemed to many people to create a pervasive atmosphere of `sleaze', in which sexual, financial and governmental misconduct were indifferently linked.
11. The allegations of sexual misbehaviour made against public figures, followed in most cases by resignation, have become almost too numerous to remember. They have been, for the most part, essentially private rather than public in character, and the performance of official duties has not been compromised. The same cannot be said of the cases that have raised questions about financial propriety. In recent years these have included payments for asking parliamentary questions and other action on behalf of clients in Parliament; the employment of ex-Ministers and former officials by firms that they have privatised or with which they had other direct dealings; alleged links between political donations and appointments; fraud and misspending in [quasi-non governmental organisations] ... and allegations that Ministers had accepted personal favours that created conflicts of interest with their public duties.38
So serious were the concerns, that the then Prime Minister, the Rt Hon. John Major, established the Committee on Standards in Public Life in October 1994 with the following terms of reference:
To examine current concerns about standards of conduct of all holders of public office, including arrangements relating to financial and commercial activities, and make recommendations as to any changes in present arrangements which might be required to ensure the highest stands of propriety in public life.39
The first Committee was chaired by Lord Nolan and was required to report back to the Prime Minister within six months. The Committee received nearly 2000 letters and heard over 100 witnesses prior to releasing its first report.40
Of relevance to the issue of secondary employment, was that during the course of the Committee's inquiries, it became evident that there had been a radical change in the nature of MPs' outside employment. In particular, it was noted that the proportion of Members pursuing careers largely unconnected with the Parliament had fallen, while `the proportion whose outside employment arises directly out of their Membership of the House of Commons has risen to a significant level'.41 The Committee's analysis of the 1995 Register of Members' Interests showed that:
...26 Members have consultancy agreements with public relations or lobbying firms and a further 142 have consultancies with other types of company or with trade associations. These 168 Members hold between them 356 consultancies. If Ministers and the Speaker are excluded there are 566 MPs. Thus almost 30% of eligible Members of Parliament hold consultancy agreements of these types....42
Furthermore, if relationships with trade unions (either as a consultant or in a sponsorship arrangement) are included, the Committee commented, `it appears in their different ways that some 389 of the 566 eligible MPs - almost 70% - have financial relationships with outside bodies which directly relate to their membership of the House'.43 These financial links were said to create a perception of dual if not divided loyalties between a Member's duties to the Parliament and his or her duties to their external clients. These findings played a critical role in the formulation of Committee recommendations relating to secondary employment and related conflicts of interest.
The landmark report of the Committee on Standards in Public Life made four general recommendations and 55 specific recommendations. Their scope has been described as radical and their impact as far-reaching44. In respect of MPs, these included:
· a new Code of Conduct for MPs
· the appointment of an independent Parliamentary Commissioner who would maintain the Register of Members' Interests and investigate allegations of misconduct
· a new sub-committee of the Committee of Privileges that would hear cases where the Commissioner recommended further action (with the implied right of appeal to the Committee of Privileges)
· full disclosure of consultancy agreements and payments, and of trade union sponsorship and payments
· submitting for public inspection any contracts relating to the provision of services in their capacity as Members
· restating a 1947 resolution of the House of Commons which places an absolute bar on Members entering into contracts or agreements which in any way restrict their freedom to act and speak as they wish, or which require them to act in Parliament as representatives of outside bodies
· a ban on Members entering into any parliamentary consultancy agreements with organisations that provided parliamentary services to multiple clients
· a more informative and detailed Register of Members' Interests.45
The report was referred to a parliamentary committee - the Select Committee on Standards in Public Life - that largely adopted the majority of recommendations. The Select Committee rejected the establishment of a sub-committee of the Committee for Privileges, instead expressing a preference for establishing a new committee that would deal with all stages of an investigation including appeal (today known as the Committee on Standards and Privileges). The Select Committee also adopted a more radical solution to the issue of consultancies, opting for a complete prohibition on paid advocacy but allowing paid advice work.46 Paid advice work includes secondary employment as a parliamentary strategist or adviser*, technical adviser or policy adviser. `Paid advice' is a broad category basically capturing all forms of consultancy work.
The implementation of the recommendations of the first Committee on Standards in Public Life has not been without difficulties. The investigation model implemented was heavily criticised and debated after the Neil Hamilton case,47 which highlighted the difficulties of the House of Commons in handling serious allegations against its own members. This matter, which involved allegations against 25 MPs, was referred to the Parliamentary Commissioner to investigate. The Commissioner completed his investigation and then reported to the Committee on Standards and Privileges. Mr Hamilton, one of the 25 MPs, made a number of objections to the manner in which the Commissioner had conducted the inquiry and contested many of the findings made by the Commissioner. The Committee considered the submissions made by Mr Hamilton and on the majority of issues agreed with the findings of the Commissioner. However, the Committee, in its report, recognised the problems highlighted by the case:
[This report's] scale and scope were wholly unlike anything envisaged by the House when it created the new system for examining complaints against the conduct of Members and appointed a Commissioner for Standards...The scale and nature of this inquiry, analogous in some ways to that of a tribunal of inquiry, have highlighted the need for the Committee to assess its role in relation to inquiries conducted by the Commissioner for Standards...there is no agreement on whether there could be an appeal against the Commissioner's findings or conclusions by the Select Committee except in consideration by the House. The Committee will examine this matter further.48
Recently, the Committee on Standards of Public Life49 and the Committee on Standards and Privileges50 have released reports on how best to deal with the issues identified. In response, on 26 June 2003 the House of Commons resolved that in serious contested cases an investigatory panel can be appointed (further discussed on p. 39). It is hoped that this change will address some of the earlier criticisms of the model.
Similarly, there continues to be debate and comments over the definition and interpretation of paid advocacy,51 with some critics arguing the definition and concept is overly complex.52
While the introduction of reforms in the British House of Commons has not been without problems and criticisms, the process of implementation and the model itself - discussed in the following sections - are of assistance in developing recommendations for the NSW Legislative Assembly.
* A parliamentary strategist provides advice on parliamentary affairs or on how to influence the Parliament and its Members.
Current model of regulation of secondary employment
Secondary employment and related conflicts of interests are dealt with in the British House of Commons through a broad framework for the regulation of parliamentary standards. The key elements to the framework are the:
· Code of Conduct and the guide to assist members
· Register of Members' Interests
· Parliamentary Commissioner for Standards
· Committee for Standards and Privileges
· investigation process for breaches of the Code of Conduct.
Each element is discussed below.
The Code of Conduct and the guide to assist members
The current Code of Conduct (see Appendix F) was approved by the British House of Commons on 24 July 1996. The code is similar to that of the NSW Parliament in that it is not a prescriptive document and is only a few pages long. It sets out a few broad rules as well as requiring members to observe the seven general principles of conduct* identified by the Committee on Standards in Public Life53 as applying to holders of public office.
The following sets out the sections of the Code relevant to secondary employment and related conflicts of interest:
· Members are to avoid conflict between personal and public interest and resolve any such conflict between the two immediately and in favour of the public interest
· Members should not undertake any action which could bring the House into disrepute
· Acceptance of a bribe to influence a Member in his or her conduct as a Member is contrary to the law of Parliament
· Members must comply with the requirements of the House in respect of compliance with the Register of Members' Interests and in addition, declare any relevant interest to any proceeding of the House or its Committees
· No Member shall act as a paid advocate in any proceeding of the House.
In addition to the Code, there is The Guide to the Rules relating to the Conduct of Members (the Guide).54 The guide is comprehensive and detailed, having four sections:
· Registration of Interests (paragraphs 8-54)
· Declaration of Interests (paragraphs 55-70)
· Lobbying for Reward or Consideration (paragraphs 71-82)
· Procedure for Complaints (paragraphs 84-93).
The Guide notes that `the rules described in this Guide derive their authority from Resolutions of the House, rather than from statute or common law, and are therefore enforceable by the House of Commons'.55
Those sections of the Guide that relate to secondary employment and related conflicts of interest are set out and discussed below.
* The seven principles are: selflessness, integrity, objectivity, accountability, openness, honesty, and leadership.
Register of Members' Interests
The Register was first established by resolution of the House of Commons on 22 May 1974 and has been enhanced over time to increase its effectiveness as an instrument facilitating transparency. As set out in the Guide for Members, the main purpose of the current Register is:
...to give public notification on a continuous basis of those pecuniary interests held by Members which might be thought to influence their parliamentary conduct or actions.56
The Register includes 10 categories of registrable interests:
1. directorships
2. remunerated employment, office, profession, etc
3. clients
4. sponsorships
5. gifts, benefits and hospitality
6. overseas visits
7. overseas benefits and gifts
8. land and property
9. shareholdings
10. miscellaneous.
The Register requires only remunerated interests or material benefits to be registered. Non-financial interests do not have to be disclosed, although many Members choose to disclose them.57
Directorships (Category 1) are defined as:
Remunerated directorships in public and private companies including directorships which are individually unremunerated, but where remuneration is paid through another company in the same group.58
Members are required to provide the name of the company and to give a broad indication of the company's business where that is not self-evident from its name.
For remunerated employment (Category 2), Members must disclose the employer company, the nature of its business, the nature of the position held or the services for which the company remunerates the Member. Members who have paid posts as consultants or advisers are also required to indicate the nature of the services, for example `management consultant', `legal advisor', `parliamentary and public affairs consultant'.59
Clients (Category 3) are defined as follows:
In respect of any paid employment registered in Category 1 (Directorships) and Category 2 (Remunerated employment, office, profession, etc.), any provision to clients of services which depend essentially upon, or arise out of, the Member's position as a Member of Parliament should be registered under this Category. All clients to which personal services are provided should be listed together with the nature of the client's business in each case. Where a Member receives remuneration from a company or partnership engaged in consultancy business which itself has clients, the Member should list any of those clients to whom personal services or advice is provided, either directly or indirectly.60
A Member who has clients in a non-parliamentary professional capacity (e.g. doctor, lawyer, accountant) is not required to register those clients, provided it is clear beyond reasonable doubt that the services provided do not in any way arise out of or relate in any way to membership of the House.
If the Member is employed as a parliamentary adviser by a company which is itself a consultancy, the Member is required to disclose those of the consultancy's clients with whom he or she has a personal connection or who benefit from the Member's advice and services.
In addition to making the above disclosures in the Register of Members' Interests relating to employment and clients; where a Member has entered or proposes to enter into an agreement which involves the provision of services in his or her capacity as a MP, and the benefit expected exceeds one per cent of the Member's current parliamentary salary, the Member is to ensure that any such agreement is in writing and is required to deposit a full copy of the agreement with the Parliamentary Commissioner (details of the agreement are to include the nature of the services to be provided and specify the fees or benefits the Member is to receive).
Miscellaneous (Category 10) encompasses all other pecuniary interests not captured by the first nine categories and any non-pecuniary interests which may conflict with the Member's parliamentary duties:
Any relevant interest, not falling within one of the above categories, which nevertheless falls within the definition of the main purpose of the Register which is to `provide information of any pecuniary interest or other material benefit which a Member receives which might reasonably be thought by others to influence his or her actions, speeches, or votes in Parliament, or actions taken in his or her capacity as a Member of Parliament,' or which the Member considers might be thought by others to influence his or her actions in a similar manner, even though the Member receives no financial benefit.61
Members are also required to declare all relevant past interests and relevant interests which they may be expecting to have, including secondary employment.
There is also a section of the guidelines dedicated to `Lobbying for Reward or Consideration' which is approximately eight pages long - considerable guidance is given to MPs to assist in interpreting this section of the guide which is based on a resolution* of the House of Commons made on 6 November 1995:
It is inconsistent with the dignity of the House, with the duty of a Member to his constituents, and with the maintenance of the privilege of freedom of speech, for any Member of this House to enter into any contractual agreement with an outside body, controlling or limiting the Member's complete independence and freedom of action in Parliament or stipulating that he shall act in any way as the representative of such outside body in regard to any matters to be transacted in Parliament; the duty of a Member being to his constituents and to the country as a whole, rather than to any particular section thereof: and that in particular no Members of the House shall, in consideration of any remuneration, fee, payment, or reward or benefit in kind, direct or indirect, which the Member or any member of his or her family has received is receiving or expects to receive-
_ Which is an amendment of an earlier resolution made on 15 July 1947.
(i) Advocate or initiate any cause or matter on behalf of any outside body or individual, or
(ii) urge any other Member of either House of Parliament, including Ministers, to do so,
by means of any speech, Question, Motion, introduction of a Bill or Amendment to a Motion or a Bill or any approach, whether oral or in writing, to Ministers or servants of the Crown. 62
As highlighted earlier, there has been considerable debate about how the advocacy rule is to be interpreted and applied, particularly in respect of initiating and participating in parliamentary proceedings. 63
The Parliamentary Commissioner for Standards
The Parliamentary Commissioner is a non-statutory post and is an Officer of the House of Commons. The Commissioner is appointed by the House and can only be dismissed by resolution of the House.
The Parliamentary Commissioner's roles and powers are set out in Standing Order 150 of the House (see Appendix G) and are summarised as follows:
· maintenance of the Register of Members' Interests and of any other register established;
· provision of confidential advice to Members and others on the registration;
· provision of advice to the Committee on Standards and Privileges and Members on the interpretation of the Code of Conduct;
· monitoring the operation of the code and any registers;
· investigating specific complaints from Members and the public in respect of
- the registration or declaration of interests
- other aspects of propriety of a Member's conduct.
On 26 June 2003, the House resolved (see Appendix H) that future appointments to the office of Parliamentary Commissioner for Standards shall be for a period of five years and shall be non-renewable*.
The Parliamentary Commissioner does not consider allegations concerning `traditional' privilege cases (e.g. leak of a Select Committee report).64
The Commissioner is an `independent element' in relation to the framework of self-regulation applied in the House of Commons. However, because the position is established through resolution and not statute, the Commissioner can only operate through the Committee. The Commissioner cannot call for persons and records except through authority derived from the powers of the Committee itself (discussed on p. 40).
Having conducted an investigation, the Parliamentary Commissioner must report to the Committee on Standards and Privileges (or to an appropriate sub-committee if appointed). As an investigator, the Commissioner is to report the facts as he or she found them and his or her opinion as to whether, on the basis of the facts, the Code has been breached. The Commissioner is to advise the Member who is the subject of the report of the content of the report (opinions and facts) prior to its release to the Committee.
_ The current Commissioner was granted a further five years with his appointment expiring on 25 June 2008.
The resolution of 26 June 2003 of the House of Commons (see Appendix H) amends Standing Order 150 and allows the Commissioner or the Committee to appoint an investigatory panel to assist the Commissioner in establishing the facts relevant to the investigation (the panel derives its powers from the Committee, as described on p. 40). This amendment was made to address previous criticisms of the capacity of the existing framework to deal with serious cases where the facts are contested. The Committee outlined that cases for which an investigatory panel is appointed should meet two criteria:
- proof of the complaint would be likely to lead to the imposition of a serious penalty on the Member; and
- there appeared to be significant contested issues of fact which would not properly be decided unless the Member was given the opportunity to call witnesses and/or to cross-examine witnesses supporting the complaint. 65
The Panel will consist of the Commissioner (who is the Chairperson of the panel) and two assessors, one of whom is to be a legally qualified person appointed by the Commissioner and the other is to be a Member appointed by the Speaker. The Member cannot be a Member of the Committee on Standards and Privileges. The amendments also allow the Commissioner to appoint Counsel for the purpose of assisting the panel and require the panel to meet in private. The Member who is the subject of the investigation can, upon request, be heard by the panel, may call witnesses, and may examine other witnesses.
When the panel reports to the Committee, it is to include any report that the Commissioner has made prior to the appointment of the panel. The amendments require the legal assessor to report to the Committee his or her opinion as to the extent which the panel's proceedings have been consistent with the principles of natural justice. The Member assessor can also report to the Committee his or her opinion as to the extent to which the panel's proceedings have had regard to the customs and practice of the House and its Members.
Finally the amendment requires the Commissioner to report annually to the House on the activities of the office. The current Commissioner released the first Annual Report on 16 July 2003.66
The Committee on Standards and Privileges
This is a select committee consisting of 11 Members reflecting the party political balance in the House. In order to counter criticisms that the Committee might be perceived as partisan, a Member from the Opposition currently chairs the Committee*. In accordance with the convention governing all select committees in the House of Commons, the committee has a majority of government members.67
The role and powers of the Committee are set out in Standing Order No. 149 of the House of the Commons (see Appendix I) but in summary are to:
· consider specific matters relating to privilege
· oversee all work of the Parliamentary Commissioner for Standards
· consider any matter relating to the conduct of Members (including breaches of the Code of Conduct)
* This reflects a recommendation of the Sixth Report (Reinforcing Standards - Review of the First Report of the Committee on Standards in Public Life). Chairman: Lord Neill of Bladen, QC. Volume 1. Report. January 2000. The current chairperson is the Rt Hon. Sir George Young, Bt (Conservative). Source: http://www.parliament.uk/parliamentary_committees/standards_and_privileges/standards_and_privileges_members.cfm
· appoint sub-committees as required to deal with specific matters referred to the committee and to appoint one such sub-committee to receive reports from the Parliamentary Commissioner relating to investigations into specific complaints.
The Committee can conduct hearings and has the power to send for persons, papers and records. Subsection six of Standing Order No. 149 also gives the Committee specific authority to order the attendance of any Member and to require the production of relevant documents held by the Member.
On 26 June 2003 the House of Commons amended Standing Order No. 149 to give the Committee the power to appoint legal advisers to assist the Committee (see Appendix H). In its Eighth Report the Committee stated the principal roles of the legal adviser as being:
- advice on legal issues arising from particular cases;
- legal advice on the procedure of the Committee from the point of view of due process;
- legal advice to the Committee on the interpretation of the Code and Guide, usually in the context of its consideration of complaints; and
- legal advice on the revision of the code or Guide or of the Committee's procedures.68
The 26 June 2003 resolution of the House of Commons also gives the Committee the power to request the Parliamentary Commissioner to appoint an investigatory panel for serious matters which are contested by the subject Member.
Apart from the procedures specified in Standing Order No. 149, the Committee determines its own procedures, within any order of reference given to it by the House. It is for the Committee to determine what evidence and reports are made public, and it has the central role of arbiter as to whether or not a complaint against a Member has been proved. The Committee retains the right to add any comments it wishes to any report of the Parliamentary Commissioner and makes recommendations to the House, where appropriate, as to what actions should be taken against a Member who is found to have breached the Code of Conduct.
The investigation process for breaches of the Code
The complaints handling process is diagrammatically represented in Appendix J. In summary, the Commissioner is able to investigate to the extent of determining whether an allegation has substance and whether the complaint has been upheld. The Commissioner presents findings and conclusion to the Committee.
When the Commissioner receives an allegation, the Commissioner asks the MP for a `truthful response' to it. On this information, the Commissioner will attempt to decide whether the allegation has substance or if it should be dismissed. If he or she cannot make this decision, the Commissioner will then carry out further investigation.
The Commissioner, at the earlier stages of the process, has the discretion to dismiss a complaint, or agree to a rectification without reference to the Select Committee. However, if the Commissioner investigates then the findings must be referred to the Committee.
If the Commissioner concludes that a complaint is upheld, then the Committee must decide whether to agree with the Commissioner's findings. In some cases, the Committee itself may decide to further investigate before adjudicating. Having done this, if the Committee concurs that the complaint is upheld and there has been a breach of the Code of Conduct, the Committee then recommends to the House either rectification (usually an apology) or penalty.
As outlined in the preceding sections, the 26 June 2003 resolution (see Appendix H) allows the Committee or Commissioner to form an investigatory panel if a matter is serious and is contested by the subject Member. Like the Commissioner, the panel submits its report to the Committee. The powers of the investigatory panel are the same as those of the Committee and the Parliamentary Commissioner.
The House will determine what type of penalty should be applied. Currently, for a breach of the Code of Conduct, the Member can be required to apologise to the House and/or may be suspended from the House for a specified period of time. During suspension, the Member's salary is withheld so that he or she also incurs a financial penalty. The Member can also be expelled from the House. On 26 June 2003 the House of Commons resolved that in appropriate cases, the House should also be able to impose a penalty of withholding a Member's salary for a specified period without suspending the Member.
The problems with this model have been noted by the Committee on Standards in Public Life,69 in particular:
· the interaction of the Commissioner's and Committee's roles have not always been smooth and there has been dissonance between the findings of the Commissioner and the conclusions of the Committee
· the lack of formal documentation of the role and procedures of the Select Committee
· procedural uncertainties such as which standard of proof should be applied
· procedure for dealing with serious contested allegations
· the issue of an appeals process remains unclear and unresolved.
The resolution of the House of Commons on 26 June 2003 (Appendix H) aims to address some of these criticisms. It is also important to note that although criticisms have been made, the model has been recognised as significantly improving the regulation of parliamentary standards in the House of Commons. Indeed, submissions to the Committee on Standards in Public Life suggest that significant improvements have been made.70 It is important to acknowledge the complexities of implementing such a model and to note that further refinement as the model is applied in practice is always required.
Chapter 3 endnotes
37 Source: http://www.parliament.the-stationery-office.co.uk/pa/cm200102/cmselect/cmstand/841/84101.htm
38 Committee on Standards in Public Life. First Report of the Committee on Standards in Public Life. Chaired by Lord Nolan. Cm 2850-I. Volume 1:Report. May 1995, p. 106. HMSO: United Kingdom.
39 The Cabinet Office. Report of the Quinquennial Review of the Committee on Standards on Public Life. January, 2001. HMSO: United Kingdom.
40 Committee on Standards in Public Life. First Report of the Committee on Standards in Public Life. Chaired by Lord Nolan. Cm 2850-I. Volume 1:Report. May 1995. HMSO: United Kingdom
41 ibid, p. 22.
42 ibid, p. 22.
43 ibid, p. 22.
44 Committee on Standards in Public Life. Sixth Report: Reinforcing Standards- Review of the First Report of the Committee on Standards in Public Life. Chaired by Sir Nigel Wicks. Cm 4557-I November 2002.
HMSO: United Kingdom.
45 Committee on Standards in Public Life. First Report of the Committee on Standards in Public Life. Chaired by Lord Nolan. Cm 4557-I. Volume 1:Report. May 1995. HMSO: United Kingdom.
46 Oonagh Gay, Parliamentary Standards. November 2001. Research Paper 01/102. Parliament and Constitution Centre. House of Commons Library. United Kingdom.
47 Committee on Standards and Privileges. First Report. Volumes I (8 July 1997 HC 30-i), II (8 July 1997 JC 30-ii), III (8 July 1997 HC 30-iii), and IV (24 July 1997 HC 39-iv). House of Commons. United Kingdom.
Committee on Standards and Privileges. Eighth Report. 5 November 1997. House of Commons. United Kingdom.
48 Committee on Standards and Privileges. Eighth Report - Standards of Conduct in the House of Commons. HC 403. February 2003, paragraph 10-11. House of Commons. United Kingdom.
49 Committee on Standards in Public Life. Sixth Report - Reinforcing Standards - Review of the First Report of the Committee on Standards in Public Life. Chaired by Lord Neill of Bladen. Cm 4557-I. Volume 1:Report. January 2000. HMSO: United Kingdom.
Committee on Standards in Public Life. Eighth Report. Chaired by Sir Nigel Wicks. Cm 5663. November 2002. HMSO: United Kingdom.
50 Committee on Standards and Privileges. Eighth Report - Standards of Conduct in the House of Commons. HC 403. February 2003. House of Commons, United Kingdom.
51 Committee on Standards in Public Life. Sixth Report - Reinforcing Standards - Review of the First Report of the Committee on Standards in Public Life. Chaired by Lord Neill of Bladen. Cm 4557-I. Volume 1:Report. January 2000. HMSO: United Kingdom.
52 Oonagh Gay, loc. cit., p. 53.
53 Committee on Standards in Public Life. First Report of the Committee on Standards in Public Life. Chaired by Lord Nolan. Cm 4557-I. Volume 1:Report. May 1995. HMSO: United Kingdom.
54 British House of Commons. The Guide to the Rules relating to the Conduct of Members, 2000. Source: http://www.parliament.the-stationery-office.co.uk/pa/cm200102/cmselect/cmstand/841/84101.htm
55 ibid, pp. 1-2.
56 ibid, p. 2.
57 Committee on Standards in Public Life. Standards of Conduct in the House of Commons. Issues and Questions Paper. February 2002, p. 10.
58 British House of Commons. The Guide to the Rules relating to the Conduct of Members, 2000, p. 4. Source: http://www.parliament.the-stationery-office.co.uk/pa/cm200102/cmselect/cmstand/841/84101.htm
59 ibid, p. 5.
60 ibid, p. 6.
61 ibid, p. 13.
62 Hansard. House of Commons, United Kingdom. 6 November 1995.
63 Hansard. House of Commons, United Kingdom. 26 June 2003.
64 Oonagh Gay, Parliamentary Standards. Research Paper 01/102. November 2001. Parliament and Constitution Centre. House of Commons Library. United Kingdom..
65 Committee on Standards and Privileges. Eighth Report - Standards of Conduct in the House of Commons. HC 403. February 2003, p. 12, paragraph 27. House of Commons, United Kingdom.
66 Parliamentary Commissioner for Standards (Sir Phillip Mawer). Annual Report 2002-03. 16 July 2003. United Kingdom.
67 Committee on Standards in Public Life. Sixth Report - Reinforcing Standards - Review of the First Report of the Committee on Standards in Public Life. Chaired by Lord Neill of Bladen. Cm 4557-I. Volume 1:Report. January 2000, p. 20, paragraph 70. HMSO: United Kingdom.
68 Committee on Standards and Privileges. Eighth Report of the Committee on Standards in Public Life: "Standards of Conduct in the House of Commons" 2003, p. 20. House of Commons. United Kingdom.
69 Committee on Standards in Public Life. Sixth Report - Reinforcing Standards - Review of the First Report of the Committee on Standards in Public Life. Chaired by Lord Neill of Bladen. Cm 4557-I. Volume 1:Report. January 2000. HMSO: United Kingdom.
Committee on Standards in Public Life. Eighth Report. Chaired by Sir Nigel Wicks. Cm 5663. November 2002. HMSO: United Kingdom.
70 ibid, Cm 4557-I.
CHAPTER 4 - SCOTTISH PARLIAMENT
The resolution of the Assembly specifically requested the ICAC to consider the practices of the Scottish Parliament in preparing this report. In considering the Scottish Parliament's practices, it is evident that the Scottish Parliament differs from the NSW Legislative Assembly in that it is a devolved parliament; its model of regulation of parliamentary standards is underpinned by statute and the Parliament itself does not operate under the protection of parliamentary privilege. Unlike the UK House of Commons and NSW Legislative Assembly, which largely deal with issues of ethical conduct and regulation through parliamentary law and practice, the Scottish model relies largely on statutory or judicial regulation.
The fact that legal and constitutional foundations of the Scottish Parliament and the NSW Legislative Assembly are different does mean that care has to be taken in assessing the extent to which the Scottish experience and model can inform the NSW position. Nevertheless there are some salient aspects of the Scottish model that have been useful in preparing this report.
The current regulatory framework in Scotland was implemented in 1999 and, like the House of Commons' framework, has evolved since that time as the Parliament has identified areas needing refinement, and made necessary changes.
This chapter provides a historical overview of the current framework of regulation of parliamentary standards in place in the Scottish Parliament, then outlines how each component of the current framework operates. These components are the Register of Members' Interests; Parliamentary Standards Commissioner and the investigation process; and the Standards Committee.
Historical events leading to current framework of regulation
In 1997 the UK Government arranged for a referendum on proposals it had put forward in a White Paper to establish the Scottish Parliament. The result of the referendum produced clear majorities in support of the proposals in the White Paper. Consequently, the Scotland Act 1998 (UK) was introduced in Parliament in January 1998 and became law in November 1998.71
Section 39 of the Scotland Act requires the Parliament to make provisions relating to the interests of Members of the Scottish Parliament (MSPs), including registration and declaration, and prohibition of paid advocacy (see Appendix K). It also makes MSPs and staff of the Parliament subject to criminal provisions relating to corrupt making or accepting of payments in connection with its business.72 The devolution legislation clearly reflected the prominence of integrity in public life issues in the United Kingdom at the time. In 1999, the Scottish Parliament established by resolution a Standards Committee.
Having been required to address the matter, the Scottish Parliament has since undertaken several concerted efforts to draft appropriate provisions for its Code of Conduct. The current Code draws on the recommendation of the Code of Conduct Working Group of the Consultative Steering Group* and was developed by the Standards Committee. The code which was endorsed by the Scottish Parliament in 2000 is consistent with the principles established in the First Report of the British Committee on Standards in Public Life (1995).
_ This Group was appointed in November 1997 by the Secretary of State for Scotland and was tasked to develop proposals for the practical operation of the new Scottish Parliament. In January 1999 it produced its report which was used as the blueprint for the Parliament's initial set of Standing Orders. Also in that report were comments on the preparation of a Code of Conduct. Subsequently, the Secretary of State further asked the Group to further consider and provide advice on the development of the Code of Conduct (Sources: http://scottish.parliament.uk/factfiles/ff1.htm ; The Scottish Parliament (The Information Centre) The Code of Conduct and MSPs' Standards. February 2000. Research Note 00/10.
In June 2002 the Scottish Parliament passed a bill for the establishment of a Parliamentary Standards Commissioner to undertake duties similar to that of the Parliamentary Commissioner for Standards in the British House of Commons.
Current model of regulation of parliamentary standards
As outlined earlier, the Scottish Parliament is distinctly different to that of the British House of Commons and the NSW Legislative Assembly in that it is a creature of statute and does not possess the parliamentary privileges held by Westminster-style legislatures. Therefore the procedures adopted by the Scottish Parliament to determine the conduct of its own members, and any actual proceedings, may be subject to judicial scrutiny. The Scottish model is also intended to deal with a broad range of conduct.
The framework has the following elements:
· Code of Conduct
· Registration and declaration of Members' interests
· Parliamentary Standards Commissioner and the investigation process
· Standards Committee.
Each element is discussed below.
Code of Conduct
The Code of Conduct for MSPs73 is established in accordance with Rule 1.6 of the Standing Order of the Parliament, made by resolution of the Parliament of 9 December 1999, which states `the Parliament may, on a motion of the Standards Committee, lay down a Code of Conduct for members'.74 The terms of the current Code of Conduct were agreed by resolution of the Parliament on 24 February 2000.75
The Code of Conduct is an extensive document being some 87 pages long with the following sections:
· Section 1: Introduction to the Code of Conduct
· Section 2: Key Principles of the Code of Conduct*
· Section 3: Introduction to the Members' Interests Order
· Section 4: Registration of Interests
· Section 5: Declaration of Interests
· Section 6: Paid Advocacy
· Section 7: Lobbying and Access to MSPs
· Section 8: Regulation of Cross-Party Groups
· Section 9: General Conduct and Conduct in the Chamber or in Committee
· Section 10: Enforcement of the Rules.
The Code of Conduct explains the rules for Members' conduct and guides them in the interpretation of the rules. Some of the rules set out in the Code of Conduct are statutory requirements while others are non-statutory and are rules created by the Parliament in the Code itself.
_ This section broadly adopts the principles found in the House of Commons Code of Conduct so is not repeated here (refer footnote on page 35).
Section 4.4 makes it the responsibility of the Member to comply with the rules:
4.4.1 Members are reminded that responsibility for ensuring compliance with the rules on registration of interests lies with the individual member. If a member is uncertain about how the rules apply, he or she may asked the Standards Committee clerks for advice. A member may also choose to consult his or her own legal advisers and, on detailed financial and commercial matters, a member may wish to seek advice from other relevant professionals.76
The regulation and declaration of Members' interests is covered under the Code of Conduct and is discussed in the following section of this report. This section summarises the other elements of the Code that apply to the issue of secondary employment and related conflicts of interest.
Section 6 of the Code of Conduct prevents a Member from advocating any cause in return for any payment or benefit. However, unlike the British model, the Scottish Code also states that Members:
should not accept any paid work to provide services as a Parliamentary strategist, adviser or consultant, for example, advising on Parliamentary affairs or on how to influence the Parliament and its Members.77
There is no prohibition on any other type of secondary employment and secondary employment issues are dealt with through strict disclosure provisions. As indicated earlier, the Scotland Act requires the Parliament to make provisions for the registration of Members' interests. The Scotland Act 1998 (Transitory and Transitional Provisions) (Members' Interests) Order 199978 (MIO) is the statutory instrument* that does this and it also covers, under Section 6, the issue of advocacy:
(6) Where, at any time after the date on which he was returned as a member, a member receives or expects to receive any remuneration, he shall not-
(a) do anything in his capacity as a member in any proceedings of the Parliament which relates directly to the affairs or interest of, or which seeks to confer benefit upon, the person from whom the member received or expects to receive remuneration or to the affairs and interests of a client or an associate of that person; or
(b) encourage any other member to do anything mentioned in paragraph (a).
Under the MIO, a Member who breaches section 6 can be excluded from the proceedings of the Parliament** for such period as the Parliament may consider appropriate [s.7(2)]. A Member who takes part in any proceedings of the Parliament and breaches section 6 is guilty of an offence and is liable on summary conviction of a fine not exceeding level 5 on the standard scale (which is currently set at 5000 pounds) [s.8]. It is worth noting that the decision to make this type of breach an offence (and those relating to declaration of registrable interests discussed in the following section) was taken against the background of perceived difficulties by the House of Commons in handling serious allegations against its own members.79
_ Article 10 of the MIO anticipates its eventual replacement by an Act of the Scottish Parliament (it is worth noting the Standards Committee has issued its 1st Report 2003, Replacing the Members' Interests Order: Draft Committee Bill).
__ A Member participates in proceedings of the Parliament if he takes part in those proceedings in any way other than voting [s5(2)].
The Code of Conduct elaborates on Section 6 of the MIO to assist members in interpreting this section. Some of the additional information provided is as follows:
· The rule on advocacy does not prevent a Member from doing paid work or being sponsored but a Member must be aware that his or her participation in the proceedings of Parliament could be constrained if acceptance of the remuneration could give rise to the inference that his or her actions in the Parliament were being undertaken in return for salary, fees, sponsorship or other remuneration received.
· The rule covers past remuneration as far back as the date on which the Member was returned and expected future remuneration as well as current remuneration.
· In seeking or accepting assistance in connection with a bill, Members are advised that it could be a breach of the rule to accept assistance in return for taking forward a bill.
· `Remuneration' for the purposes of advocacy, includes benefits or hospitality that members receive in the course of their parliamentary duties.
· The rules also prohibit a Member from participating in proceedings in return for remuneration where those proceedings relate directly to the affairs or interests of a client or associate (e.g. family, partner, employee) of the person or of the company or of whoever gave the remuneration to the Member.80
The code also has a specific section on lobbying and access to MSPs which states:
Members need to bear in mind these statutory obligations in their contacts with anyone who seeks to lobby them, and particularly when considering whether to accept any remuneration, sponsorship, gift, benefit or hospitality from another person.81
Members are also advised to not offer or accord preferential access to commercial lobbyists or their employers.
It is also worth noting that the Standards Committee has drafted a bill82 to replace the MIO for consideration at the next session of Parliament. Like the British House of Commons, the Scottish Parliament has had some problems with the provisions relating to advocacy. The draft Bill makes it clear that paid advocacy takes place where there is a nexus between receipt of a payment or benefit which represents a personal gain to the Member and the Member undertaking an action in his or her capacity as a MSP. This is to amend the current definition, which fails to specify a link between remuneration and action taken by the Member.
Registration of Members' Interests
The MIO sets out the various requirements on registration and declaration on Members' interests and makes contravention of certain provisions a criminal offence.
The purpose of the MIO is to provide information about certain financial interests of Members which might reasonably be thought by others to influence Members' actions, speeches or votes in the Parliament, or in other actions taken in their capacity as Members. Members are required to make an initial disclosure within 30 days of becoming a Member. Thereafter the declaration must be made within 30 days of a change in a current interest or new interest being identified.
In terms of secondary employment and related conflicts of interest, section 2 of the MIO states that a Member has a registrable interest:
(1) Where a member receives remuneration by virtue of -
(a) being employed;
(b) being self-employed;
(c) being the holder of an office;
(d) being a director of an undertaking;
(e) being a partner in a firm; or
(f) undertaking a trade, profession or vocation or any other work.
In making a disclosure, a Member is required to give details of his or her employer, the nature of its business and nature of the post the Member holds or the services for which the organisation remunerates the Member. Similar declarations are required for the self-employment category. For directorships, the registered name of the undertaking and a broad indication of its business is required. For a trade, profession or vocation, Members must provide details of both nature of the work and its regularity (e.g. a Member who writes for a newspaper should give the name of the publication, the frequency of articles for which he or she is paid and the level of remuneration).
In addition to remuneration, the following are also registrable interests under the MIO:
· related undertaking where Member is a director of a related undertaking but does not receive remuneration as such director
· contributions to election expenses in excess of 25% of total election expenses
· sponsorship
· gifts in excess of 250 pounds received by the Member or their spouse
· overseas visits
· heritable property
· interest in shares by either the Member or their spouse.
In addition to registering the above interests, the MIO also requires the Member to make an oral statement declaring the nature of that registrable interest before any proceedings where it could be considered that the interest could prejudice, or could appear to prejudice the Member's ability to participate in a disinterested manner in those proceedings [s.5(1)]. A Member who has a declarable interest does not need to declare that interest if he or she simply attends or votes at a meeting but does nothing else.
Under the MIO, when a Member fails to declare the above interests in the register the Parliament can exclude the Member from proceedings of the Parliament for such period as the Parliament may consider appropriate [s.7(2)]. A Member who takes part in any proceedings of the Parliament* without having complied with the declaration requirements is guilty of an offence and is liable on summary conviction of a fine not exceeding level 5 on the standard scale (which is currently set at 5000 pounds) [s.8].
Outside of the above registrable interests, a Member can also make a voluntary declaration under the `Miscellaneous' category of the register.
_ A Member participates in proceedings of the Parliament if he takes part in those proceedings in any way other than voting [s5(2)].
It is also worth noting that in the draft Bill83 being proposed by the Standards Committee to replace the MIO, non-pecuniary interests which might be thought by others to influence a Member's actions in the Parliament will be subject to mandatory registration. This will capture unremunerated directorships, membership of voluntary and charitable organisations, professional bodies, societies or sporting and cultural organisations.
Parliamentary Standards Commissioner and the investigation process
The Scottish Parliament has adopted a similar system to that employed by the British House of Commons for investigating complaints, however the Parliamentary Standards Commissioner in Scotland is established through statute rather than by resolution of the Parliament.
The functions of the Commissioner under the Scottish Parliament Standards Commissioner Act 2002 are to investigate whether a Member has committed the conduct complained about and has, as a result of that conduct, breached a relevant provision; and to report upon the outcome of that investigation to the Parliament (s. 3). Like the UK Parliamentary Commissioner, the Commissioner can make a finding but cannot make recommendations as to what sanctions should be imposed on the Member. However, unlike the UK model, the Commissioner does not have a role in advising Members because of the potential conflict between the roles of adviser and investigator.
The Act gives the Commissioner the power to call for witnesses and documents and makes it an offence to fail to comply with notices of the Commissioner to appear or produce documents.
Dealing with complaints involves a four-stage process:
· Stage 1 - (Admissibility) - The Standards Commissioner will investigate and determine the admissibility of the complaint.
· Stage 2 - (Investigation) - If a complaint is admissible, a further investigation into the complaint will be carried out by the Standards Commissioner who will then report his or her findings in fact and conclusions to the Standards Committee.
· Stage 3 - (Report) - A report to the Parliament is made by the Standards Committee following the Committee's consideration of the Standards Commissioner's report.
· Stage 4 - (Decision) - If the Standards Committee has recommended the imposition of sanctions against a Member, a decision on sanctions is made by the Parliament on a motion of the Standards Committee.84
In making findings of fact the Commissioner is required to do so on the balance of probabilities.
Apart from a Member being able to make representation to the Standards Committee on a report of the Commissioner, or when the Committee decides to impose a sanction, there is no formal process of appeal. If the conduct amounts to an offence, the matter is dealt with outside the Parliament although the Parliament may decide to impose a sanction if a Member is found guilty of an offence.
Standards Committee
The remit of the Standards Committee is to consider and report on:
(a) whether a member's conduct is in accordance with these Rules and any Code of Conduct for members, matters relating to members' interests, and any other matters relating to the conduct of members in carrying out their Parliamentary duties; and
(b) the adoption, amendment and application of any Code of Conduct for members.85
The Code of Conduct directs that if Members are unsure about how the rules of the Code apply, they are to ask the Standards Committee clerks for advice. Members are also free to consult their own legal advisers or any other relevant professionals.
The Committee receives the reports of the Standards Commissioner and considers the findings and conclusions. The Committee can:
· agree with the Standards Commissioner's findings in fact and conclusion
· refer the complaint back to the Standards Commissioner for further investigation or clarification
· conduct its own investigation into the complaint.
When the Committee receives a report, it then produces its own report for Parliament which will include the Commissioner's report and any relevant evidence. The report of the Standards Committee will include:
· the Standards Committee's conclusion as to whether or not the complaint should be upheld
· the Standards Committee's recommendation as to the sanctions (if any) which should be imposed on the Member who is the subject of the report
· any other relevant information or evidence as determined by the Committee.
Similar to the British House of Commons model, it is a matter for the Parliament to determine what action it should take against one of its own members. In both models the Investigating Commissioner does not have the power to determine or recommend how the subject Member should be dealt with.
Chapter 4 endnotes
71 Source: http://www.scottish.parliament.uk/factfiles/ffl.htm
72 The Scottish Parliament (The Information Centre). The Code of Conduct and MSPs' standards. February 2000. Research Note 00/10.
73 Scottish Parliament. Code of Conduct for Members of the Scottish Parliament. Revised 01-05-03. Source: http://www.Scottish.parliament.uk/msps/coc/coc-c.htm
74 ibid, p. 1, paragraph 1.4.
75 ibid, introduction (no page number).
76 ibid, p. 32.
77 ibid, p. 51.
78 Source: http://www.hmso.gov.uk
79 Committee on Standards in Public Life. The Regulation of Parliamentary Standards - A Comparaitve Perspective. May 2002. Research Paper.
80 Scottish Parliament. Code of Conduct for Members of the Scottish Parliament. Revised 01-05-03. Source: http://www.Scottish.parliament.uk/msps/coc/coc-c.htm
81 ibid, p. 49.
82 Standards Committee. Replacing the Members' Interests Order: Draft Committee Bill. 2003. Scottish Parliament.
83 ibid.
84 Scottish Parliament. Code of Conduct for Members of the Scottish Parliament. Revised 01-05-03, p. 72. Source: http://www.Scottish.parliament.uk/msps/coc/coc-c.htm
85 Source: http://www.scottish.parliament.uk/standards/index.htm
CHAPTER 5 - ALTERNATIVE MODELS TO THE UK AND SCOTLAND
In reviewing the practices of parliaments other than the UK and Scotland it was noted that the Legislative Assembly of Ontario and the Canadian House of Commons, both Westminster-style parliaments, have models which offer some alternatives to the models in Britain and Scotland. The chapter sets out the aspects of those models that differ from those of the UK House of Commons and Scotland and which have been of assistance in developing recommendations for the NSW Legislative Assembly.
Legislative Assembly of Ontario
The most significant aspects of the model adopted by the Legislative Assembly of Ontario are the rules regarding secondary employment and related conflicts of interest and the role of the Office of the Integrity Commissioner. These differ in significant and relevant ways to the equivalent rules and roles that operate in the British House of Commons and the Scottish Parliament.
Issue of secondary employment
The rules regarding conflicts of interest for the Legislative Assembly of Ontario are set out in the Members' Integrity Act 1994.86 The preamble of the Act states:
The Assembly as a whole can represent the people of Ontario most effectively if its members have experience and knowledge in relation to many aspects of life in Ontario and if they can continue to be active in their own communities, whether in business, in the practice of a profession or otherwise.
This statement clearly communicates an important principle that has been adopted by the Ontario Legislative Assembly, but this principle does not extend to those Members who hold positions in the Cabinet (Executive Council) although there are exceptions to this rule:
Outside Activities
10. A member of the Executive Council shall not,
(a) engage in employment or the practice of a profession;
(b) engage in the management of a business carried on by a corporation; or
(c) hold an office or directorship, unless holding the office or directorship is one of the member's duties as a member of the Executive Council, or the office or directorship is in a social club, religious organization or political party. 1994, c.38, s.10.
Investments
11. (1)A member of the Executive Council shall not hold or trade in securities, stocks, futures or commodities. 1994, c. 38, s. 11 (1).
Exception
(2) Subsection (1) does not apply to assets and liabilities described in subsection 21 (4). 1994, c. 38, s. 11 (2).
Management trust
(3) A member may comply with subsection (1) by entrusting the assets to one or more trustees on the following terms:
1. The provisions of the trust shall be approved by the Commissioner.
2. The trustees shall be persons who are at arm's length with the member and approved by the Commissioner.
3. The trustees shall not consult with the member with respect to managing the trust property, but may consult with the Commissioner.
4. At the end of each calendar year and at one or more intervals during the year, the trustees shall give the member a written report stating the value, but not the nature, of the assets in the trust. The year-end report shall also state the trust's net income for the preceding year and the trustees' fees, if any.
5. The trustees shall also give the member sufficient information to permit him or her to submit returns as required by the Income Tax Act (Canada) and shall give the same information to Revenue Canada.
6. The trustee shall give the Commissioner copies of all information and reports given to the member.
7. The trust shall provide that the member may, at any time, instruct the trustees to liquidate all or part of the trust and pay over the proceeds to the member. 1994, c. 38, s. 11 (3).
Partnerships and sole proprietorships
12. (1) A member of the Executive Council shall not carry on business through a partnership or sole proprietorship. 1994, c. 38, s. 12 (1).
Management trust
(2) A member may comply with the requirements of subsection (1) by entrusting the business or his or her interest in the business to one or more trustees on the following terms:
1. The provisions of the trust shall be approved by the Commissioner.
2. The trustees shall be persons who are at arm's length with the member and approved by the Commissioner.
3. The trustees shall not consult with the member with respect to managing the trust property, but may consult with the Commissioner.
4. Annually, the trustees shall give the Commissioner a written report stating the nature of the assets in the trust, the trust's net income for the preceding year and the trustees' fees, if any.
5. The trustees shall also give the member sufficient information to permit him or her to submit returns as required by the Income Tax Act (Canada) and shall give the same information to Revenue Canada.
6. The member is entitled to be reimbursed from the Consolidated Revenue Fund for reasonable fees and disbursements actually paid for the establishment and administration of the trust, as approved by the Commissioner, but is responsible for any income tax liabilities that may result from the reimbursement. 1994, c. 38, s. 12 (2).
Approved exceptions
13. A member of the Executive Council may engage in an activity prohibited by clause 10 (b) or (c) or subsection 11 (1) or 12 (1) if the following conditions are met:
1. The member has disclosed all material facts to the Commissioner.
2. The Commissioner is satisfied that the activity, if carried on in the specified manner, will not create a conflict between the member's private interest and public duty.
3. The Commissioner has given the member his or her approval and has specified the manner in which the activity may be carried out.
4. The member carries the activity out in the specified manner. 1994, c. 38, s. 13.
This model deals with the secondary employment issue partly by prohibition and partly by regulation - this represents an alternative to the situation in the British House of Commons, the Scottish Parliament and the NSW Legislative Assembly. The Act is clear that section 10 applies only to Members of the Executive Council, by preserving the rights of other Members under section 9:
9. Nothing in this Act prohibits a member of the Assembly who is not a member of the Executive Council from:
(a) engaging in employment or in the practice of a profession;
(b) receiving fees for providing professional services under the Legal Aid Services Act, 1998;
(c) engaging in the management of a business carried on by a corporation;
(d) carrying on a business through a partnership or sole proprietorship;
(e) holding or trading in securities, stocks, futures and commodities;
(f) holding shares or an interest in any corporation, partnership, syndicate, cooperative or similar commercial enterprise;
(g) being a director or partner or holding an office, other than an office that a member may not hold under another Act. 1994, c. 38, s. 9; 1998, c. 26, s. 107.
In addition to the above, Sections 7(1) and 7(2) of the Act also prohibit all Members, not just those in Executive Council from:
· knowingly being a party to a contract with the Government of Ontario under which the Member receives a benefit, and
· having an interest in a partnership or in a private company that is a party to a contract with the Government of Ontario under which the partnership or company receives a benefit.
There are exceptions to Sections 7(1) and 7(2) as follows:
Exception, existing contracts
(3) Subsections (1) and (2) do not apply to a contract that existed before the member's election to the Assembly, but they do apply to its renewal or extension. 1994, c. 38, s. 7 (3).
Exception, nature of interest
(4) Subsection (2) does not apply if the Commissioner is of the opinion that the interest is unlikely to affect the member's performance of his or her duties. 1994, c. 38, s. 7 (4).
Exception, management trust
(5) Subsection (2) does not apply if the member has entrusted his or her interest to one or more trustees on the following terms:
1. The provisions of the trust shall be approved by the Commissioner.
2. The trustees shall be persons who are at arm's length with the member and approved by the Commissioner.
3. The trustees shall not consult with the member with respect to managing the trust property, but may consult with the Commissioner.
4. Annually, the trustees shall give the Commissioner a written report stating the nature of the assets in the trust, the trust's net income for the preceding year and the trustees' fees, if any.
5. The trustees shall also give the member sufficient information to permit him or her to submit returns as required by the Income Tax Act (Canada) and shall give the same information to Revenue Canada. 1994, c. 38, s. 7 (5).
Exception, pensions
(6) Subsection (1) does not prohibit a member from receiving benefits under the Legislative Assembly Retirement Allowances Act, the Public Service Act, the Public Service Pension Act, the Teachers' Pension Act or any other Act that provides for retirement benefits funded wholly or partly by the Government of Ontario. 1994, c. 38, s. 7 (6).
It should be noted that there are similar provisions for the British House of Commons although these rules are enshrined in a Ministerial Code of Conduct rather than in statute. In the British House of Commons, members appointed to Ministerial positions are required to give up any public appointments they may hold and are encouraged to either dispose of any financial interest giving rise to the actual or apparent conflict or to take alternative steps to prevent it. Where a Minister wishes to retain financial interests, they are encouraged to do so through a `blind' trust. A Minister must resign any directorships he or she holds when taking up office but may remain a partner in a business providing he or she does not play any part in the day-to-day management of the firm's affairs and ceases to practice any profession.87 The Scottish Parliament has similar provisions, contained within the Scottish Ministerial Code.88
Procedures for declaring a conflict of interest
The procedures on conflict of interest are also more stringent that those in the British House of Commons and the Scottish Parliament. In particular, under Section 16 a Member of the Executive Council who believes he or she may have a conflict in a matter that requires the Member's decision is required to ask the Premier or Deputy Premier to appoint another Member of the Executive Council to perform the Member's duties in the matter for the purpose of making the decision. Similarly, under Section 8 a Member of the Legislative Assembly who has a conflict on a matter that is before the Ontario Assembly or Executive Council, or of a committee of either of them, is required before proceedings begin to disclose the general nature of the conflict and is to withdraw from the meeting or proceeding without voting or participating in consideration of the matter.
The process of disclosure is also prescribed under the Members' Integrity Act and differs from that in operation in the British House of Commons and in the Scottish Parliament. Members are required to file with the Integrity Commissioner a private disclosure statement within 60 days of being elected and thereafter once every calendar year. The details of disclosure are similar to the House of Commons and the Scottish Parliament so are not further elaborated on. After filing the private disclosure statement, the Member, and the Member's partner if available, is required to meet with the Commissioner to ensure that adequate disclosure has been made and to obtain advice on the Member's obligations under the Act (s. 20).
The Integrity Commissioner then prepares a public disclosure statement on the basis of the information provided by the Member (s. 20). The Commissioner has discretion to withhold information from public disclosure if, in his or her opinion, the information is not relevant to the purpose of the Members' Integrity Act, and a departure from the general principle of public disclosure is justified. The public interest disclosure statement is submitted by the Integrity Commissioner to the Clerk who makes the statement available for examination by members of the public. The Clerk can provide a copy of a statement to any person who pays the fixed fee.
Under Section 20(4) a Member is required to file a statement of material change with the Integrity Commissioner within 30 days after a change in the income, assets of liabilities of the Member or his or her partner and minor children.
The Integrity Commissioner
The Integrity Commissioner position is established under the Members' Integrity Act. The role is similar to that of the Parliamentary Commissioner in the House of Commons and the Scottish Parliament in that the Commissioner has an investigative function in respect of conduct that breaches the Act.
Like the British House of Commons, the Legislative Assembly of Ontario is a Westminster-style parliament. However, Ontario created the Commissioner's position by statute rather than by resolution, and the Ontario model also differs from the House of Commons model in the following respects:
· Members of the public cannot make a complaint to the Integrity Commissioner. Complaints or allegations can only be made by another Member of the House (s. 30).
· The Integrity Commissioner may elect to exercise the powers of a commission under Parts I and II of the Public Inquiries Act 1990 (Ontario, Canada) - these powers are typical of those provided to commissions of inquiry more generally, and include the power to summons any person to give evidence or to produce any document and things. In addition there are powers to obtain a warrant to apprehend witnesses (e.g. in the case of failing to appear) and to execute search warrants.
· The Commissioner is required to recommend the following types of action be taken in respect of a Member who has contravened the Act:
- that no penalty be imposed
- that the Member be reprimanded
- that the Member's right to sit and vote in the Assembly be suspended for a specified period or until a condition imposed by the Commissioner is fulfilled; or
- that the Member's seat be declared vacant (s. 34).
· Section 34 sets out how the Ontario Assembly can respond to recommendations of the Integrity Commissioner:
Duty of the Assembly
(2) The Assembly shall consider and respond to the report within 30 days after the day the report is laid before it. 1994, c. 38, s. 34 (2).
Response
(3) If the Commissioner recommends that a penalty be imposed, the Assembly may approve the recommendation and order that the penalty be imposed, or may reject the recommendation, in which case no penalty shall be imposed. 1994, c. 38, s. 34 (3).
Power of Assembly
(4) Despite section 46 of the Legislative Assembly Act, the Assembly does not have power to inquire further into the contravention, to impose a penalty if the Commissioner recommended that none be imposed, or to impose a penalty other than the one recommended. 1994, c. 38, s. 34 (4).
Decision final
(5) The Assembly's decision is final and conclusive. 1994, c. 38, s. 34 (5).
The Act is silent on the issue of breaches which involve conduct protected by parliamentary privilege, however given this Assembly is a Westminster-style parliament this implies that the Integrity Commissioner cannot conduct such an investigation unless privilege is waived by the House.
Canadian House of Commons
The Canadian House of Commons is still in the process of developing its model for the regulation of parliamentary standards. Under the current arrangements there is a Conflict of Interest and Post-Employment Code for Public Office Holders89 which has been in force since 1994. It applies only to `public officer holders' who are defined as:
4.(1)For the purposes of this Part and the Schedule, `public office holder' means:
a. a Minister of the Crown, including a Secretary of State;
b. a parliamentary secretary;
c. a member of ministerial staff, except public servants;
d. a full-time Governor in Council appointee, other than:
i. a Lieutenant-Governor of a province,
ii. officers and staff of the Senate, House of Commons and Library of Parliament;
iii. a public servant who is a head of mission as defined in the Department of Foreign Affairs and International Trade Act, [amended September 25, 1998];
iv. a judge who receives a salary under the Judges Act, and
v. a commissioned officer of the Royal Canadian Mounted Police, other than the Commissioner of the Royal Canadian Mounted Police; or
e. a full-time ministerial appointee designated by the appropriate Minister of the Crown as a public office holder.
The Code generally prohibits `public officer holders' from engaging in secondary employment:
Prohibited Activities
17.Subject to section 18, public office holders shall not, outside their official duties,
a. engage in the practice of a profession;
b. actively manage or operate a business or commercial activity;
c. retain or accept directorships or offices in a financial or commercial corporation;
d. hold office in a union or professional association; or
e. serve as a paid consultant.
Permissible Activities
18.(1)When the activities described in section 17 relate to the official duties and responsibilities of a public office holder, the public office holder may, in exceptional circumstances and with the approval required by subsection 7(4) become or remain involved in them, but may not accept remuneration for any activity, except as provided in subsections (3) and (4).
(2)A public office holder may with the approval required by subsection 7(4) retain or accept directorships in organizations of a philanthropic, charitable or non-commercial character, but the office holder shall take great care to prevent conflicts of interest from arising.
(3)Where the Prime Minister or a person designated by the Prime Minister is of the opinion that it is in the public interest, full-time Governor in Council appointees to Crown Corporations, as defined in the Financial Administration Act, may retain or accept directorships or offices in a financial or commercial corporation, and accept remuneration therefore, in accordance with compensation policies for Governor in Council appointees as determined from time to time.
(4)Ministerial support staff may, in exceptional circumstances and with the approval required by subsection 7(4), become or remain involved in activities that do not place on them demands inconsistent with their official duties and responsibilities or call into question their capacity to perform their official duties and responsibilities objectively.
The Code also established an Ethics Counsellor with the tasks of maintaining personal confidential files, ensuring that information provided by a `public officer holder' for a public purpose is made available, and ensuring that files are destroyed in accordance with the relevant legislation.
The Canadian House of Commons is considering certain changes to the current model, which include replacing the Ethics Counsellor with an Ethics Commissioner.90 In order to effect such a change, amendment to the Parliament of Canada Act would be required.
In conjunction with this proposal, the Canadian House of Commons Standing Committee on Procedure and House Affairs has produced a report91 that proposes a Conflict of Interest Code for Members of the House of Commons, with the Ethics Commissioner having the jurisdiction to not only advise Members but also conduct investigations into breaches of the Code. However, in considering the UK House of Commons model, the Committee formed the view that the Ethics Commissioner should report directly to the House and that also having a Committee with the role of considering the reports of the Ethics Commissioner and undertaking investigation itself in serious contested cases unnecessarily complicates the model. The relevant sections of the Select Committee's report state:
19. Both the Milliken-Oliver report and the Code as introduced provide for a committee to play a very major role in dealing with complaints that Members have not lived up to their obligations under the Code. It was proposed that the Ethics Commissioner would investigate and report to the committee. In serious cases where the facts were disputed and no agreement on a remedy was reached between the Ethics Commissioner and the Member involved, the committee would actually conduct its own inquiry, and then report to the House.
20. Although in our earlier working document for Members, the Committee felt that the existence of a committee had a number of attractions and could play an important role, upon further reflection we have now concluded that this model contains some serious flaws. Members are concerned about the possibility of excessive partisanship and complexity that the committee process could introduce. Although we received some excellent suggestions on ways to minimize partisanship (for example, by changing the composition of the committee and by choosing only senior people), we fear that they may be less than fully successful.
21. Nor do we regard a committee as essential. We look to the Canadian provinces in this regard. None has a committee with that kind of mandate interposed between the Ethics Commissioner and the legislature. Although the British House of Commons has a committee structure, they are struggling with ways to improve it, in the process possibly adding more layers of complexity.
22. We also have doubts that a committee is an effective mechanism to conduct a detailed, factual inquiry in which an individual's rights and reputation may be at stake, and in which procedural fairness is important. Committees are not used to that kind of inquiry. They are excellent at taking the public pulse on a current issue or a bill; they provide a forum where important public policies can be discussed and through which Members can provide advice to the government. However, we feel that the conduct of all inquiries involving complaints about Members and the Code should be left to the Ethics Commissioner.
23. Such an enforcement structure would enhance the Ethics Commissioner's independence and authority, and make it easier to safeguard confidential information. It would also simplify what was a rather complex process.
24. Our recommendation does not mean that there would be no role for a committee vis-à-vis the Ethics Commissioner. We propose that general oversight of the Code and the work of the Ethics Commissioner would fall to the Standing Committee on Procedure and House Affairs. Its work would include reviewing the Ethics Commissioner's annual report, reviewing rules that the he or she may propose and reporting the rules to the House for final approval. Moreover, we recommend that the Committee conduct a comprehensive review of the Code every five years. We have chosen this Committee because it is the senior House standing committee and, because of its membership, is in an excellent position to assess the views and experiences of Members.92
The draft Code requires a range of disclosures to be made and requires maintenance of a public register. Many of the provisions are similar to those in force for the Ontario Legislative Assembly, discussed above.
The Code also specifies that if the Ethics Commissioner concludes that a Member has not complied with an obligation under the Code, the Ethics Commissioner can recommend appropriate sanctions to be considered by the House.
Finally, paid advocacy is dealt with under the Parliament of Canada Act, which states:
Receiving prohibited compensation 41. (1) No member of the House of Commons shall receive or agree to receive any compensation, directly or indirectly, for services rendered or to be rendered to any person, either by the member or another person,
(a) in relation to any bill, proceeding, contract, claim, controversy, charge, accusation, arrest or other matter before the Senate or the House of Commons or a committee of either House; or
(b) for the purpose of influencing or attempting to influence any member of either House.
Offence and punishment (2) Every member of the House of Commons who contravenes subsection (1) is guilty of an offence and liable to a fine of not less than five hundred dollars and not more than two thousand dollars and shall, for five years after conviction of that offence, be disqualified from being a member of the House of Commons and from holding any office in the public service of Canada.
Offering prohibited compensation (3) Every person who gives, offers or promises to any member of the House of Commons any compensation for services described in subsection (1), rendered or to be rendered, is guilty of an indictable offence and liable to imprisonment for a term not exceeding one year and to a fine of not less than five hundred dollars and not more than two thousand dollars.
R.S., c. S-8, s. 23.
Chapter 5 endnotes
86 Source: www.e-laws.gov.on.ca/DBLaws/Statutes/English/94m38_e.htm
87 The Cabinet Office. Ministerial Code: A Code of Conduct and Guidance on Procedures for Ministers. Section 9 (Ministers' Private Interests). July 2001. House of Commons: United Kingdom. Source:http://www.cabinet-office.gov.uk/central/2001/mcode/contents.htm
88 The Scottish Executive. Scottish Ministerial Code: A code of conduct and guidance for members of the Scottish Executive and Junior Scottish Ministers. February 2002. Scottish Parliament: Scotland.
Source: http://www.scotland.gov.uk/library3/government/smic.pdf
89 Source: www.strategis.ic.gc.ca/SSG/oe00002e.html
90 Bill C-34: An Act to amend the Parliament of Canada Act (Ethics Commissioner and Senate Ethics Officer) and other Acts in consequence. 2003. Legislative Summary. Library of Parliament (Canada) - Parliamentary Research Branch. Source: www.parl.gv.ca/commons/bills_Is.asp?lang=E&Is=c34&source=library_rb&Parl=37&Ses=2
91 Standing Committee on Procedure and House Affairs. June 2003. Fortieth Report. House of Commons, Ottawa, Canada.
92 The Standing Committee on Procedure and House Affairs. Fortieth Report. June 2003. Paragraphs 19 - 24. p. 4. Source: www.parl.gc.ca/InfoComDoc/37/2/HAFF/Studies/Reports/HAFFRP40-E.htm
CHAPTER 6 - REFORM FOR THE NSW LEGISLATIVE ASSEMBLY
The NSW Legislative Assembly has requested the ICAC to report to the Speaker of the House on what measures might be taken in respect of regulating or limiting the employment of MPs to provide advice in `public affairs'. In doing so, the ICAC has, as requested, considered relevant provisions applying to the British House of Commons and the Scottish Parliament, and reviewed the literature relating to those two models. We also asked for the views of the Members of the NSW Assembly regarding the disclosure scheme in place for that House. Finally we considered two other parliaments, the Ontario Legislative Assembly and the Canadian House of Commons, which offered variations on the models used in the British House of Commons and Scotland in respect of secondary employment and related conflicts of interests.
The preceding chapters outlined the relevant aspects of the model in each parliament considered. It is apparent that the models used in the overseas parliaments are more comprehensive and detailed than that in place within the Assembly, or indeed in any of Australia's legislatures.* The rules for Members of these overseas parliaments are spelled out in detail and the disclosure regimes are considerably stricter than those used in the NSW Assembly. The Ontario Legislative Assembly and Canadian House of Commons go further than the British House of Commons and Scottish Parliament in that they also prohibit secondary employment for senior Government Members.
However, the purpose of this report is neither to broadly compare the regulatory frameworks nor to recommend changes to make the framework in the Assembly more closely resemble those in use in the overseas parliaments considered in this report. The ICAC's objective was to look at elements relating to secondary employment and related conflicts of interest in other models, and to consider if those elements could be adopted or adapted into the model currently in use in the Assembly.
This chapter addresses those issues identified by the resolution of the Assembly and makes recommendations as to what changes the House could make to its current regulatory framework (comprising of the Code of Conduct, statute and resolutions of House), based on a consideration of models in other jurisdictions and from the literature review. Also where relevant, the opinions provided by some Members are also discussed.
This chapter addresses the following issues:
· prohibiting secondary employment for MPs
· prohibiting or limiting secondary employment in `public affairs'
· guidelines and principles for Members of the Legislative Assembly
· paid advocacy
· disclosure and the register of pecuniary interests
· maintenance of the register of interests
· enforcement and investigation of breaches by Members
· implementing the recommendations.
_ A useful summary of the provisions in Australian parliaments concerning disclosure of Members' pecuniary interests can be found in Appendix 3 of the Report on inquiry into the Pecuniary Interests Register, 2002, Standing Committee on Parliamentary Privilege and Ethics, Parliamentary Paper Number 218, Parliament of New South Wales.
Prohibiting secondary employment for MPs
Although the resolution of the Assembly did not request the ICAC to consider the broader issue of whether MPs should be allowed to engage in any form of secondary employment, some responses received from Members did raise this issue. In consideration of the particular situation in NSW, some general comments can be made on this point.
It should be recognised that until relatively recently there was a tradition of backbench Members of Parliament in Westminster-style legislatures being financially self-sufficient, either through independent wealth or income earned from secondary sources.93 The payment of a full-time salary to MPs (as distinct from Ministers) is a relatively recent phenomenon. For instance, the Constitution of the Commonwealth of Australia, drafted at the turn of the century, makes an effective distinction between salaries being paid to Ministers and allowances being paid to backbenchers. In the UK, Members of the House of Commons were not paid at all for their parliamentary duties until 1911.94
Significant changes occurred in Australian legislatures from the 1950s onwards, to the current situation where MPs are now paid a full-time salary, often determined by an independent tribunal or tied to salaries and adjustments in another jurisdiction.
From July 1990, the salary of a Member of the NSW Assembly has been pegged to the salary of a Member of the Commonwealth House of Representatives (less $500). Since 1996, the salaries of Members of the House of Representatives have in turn been pegged to those of Principal Executive Officers in the Commonwealth Public Service.
The effect of the changes over time are such that in the NSW Parliament, salaries for Members for the Legislative Assembly have risen from $6,840 in 1966 to $98,300 in 2002, while the salaries of Members of the Legislative Council during the same period have gone from $2,040 to $98,300.95
While the receipt of income from secondary sources, particularly secondary employment, is now less prevalent, no doubt in part because of the increases in salary, some Members still maintain outside employment. The potential for this to have a bearing upon the performance of their parliamentary duties is recognised in the requirement that they declare the nature and source of any such outside interests.
The description of the different approaches of the jurisdictions in respect of secondary employment highlights two different approaches. The Canadian parliaments discussed in this report have adopted models that combine partial prohibition and a scheme of disclosure and regulation. In particular, these models prohibit particular senior Members (e.g. Members of Cabinet) from holding any form of secondary employment.
However, there are parliaments that have decided against a model of prohibition irrespective of whether it applies to particular Members or all Members. A case in point is the British House of Commons, which - despite the scandals of the 1980s and 1990s - decided that a comprehensive model of declaration and registration is sufficient to deal with these types of issues. The first Committee on Standards in Public Life did receive submissions that MPs in the UK House of Commons should have no outside paid interests and that their only incomes should be their parliamentary salaries. The Committee considered these submissions and concluded that:
...we also consider it desirable for the House of Commons to contain Members with a wide variety of continuing outside interests. If that were not so, Parliament would be less well-informed and effective than it is now, and might well be more dependent on lobbyists. A Parliament composed entirely of full-time professional politicians would not serve the best interests of democracy. The House needs if possible to contain people with wide range of current experience which can contribute to its expertise it is desirable for the House of Commons to contain Members representing wide variety of continuing outside interests...As well as having Members with continuing outside interests, it is important that the House of Commons should continue to contain Members from a wide variety of backgrounds. We should be worried about the possibility of a narrowing in the range of able men and women who would be attracted to stand for Parliament if Members were barred from having any outside interests. We believe that many able people would not wish to enter Parliament if they not only had to take a substantial drop in income to do so but also ran the risk of seeing their source of livelihood disappear altogether if they were to lose their seats...We recommend that Members of Parliament should remain free to have paid employment unrelated to their role as MPs.96
It would appear that the Ontario and Canadian models offer a `middle ground' between complete prohibition and complete regulation. The points made in the above quotation do contain merit, however it is also reasonable to expect that senior members of a Government (e.g. the Premier, Deputy Premier and Ministers) should not hold or need to hold secondary employment. Notwithstanding the additional salary they receive over ordinary Members of the Assembly, it would be reasonable to expect that their duties and workloads in those senior positions would preclude them having the time available to undertake secondary employment.
However, it is a matter for each jurisdiction to determine what the relevant issues are confronting the House in respect of secondary employment, and what approaches to adopt to best deal with those issues. The ICAC makes no recommendations in this regard but notes the different approaches used in the respective overseas parliaments.
Prohibiting or limiting secondary employment in providing `public affairs' advice
The resolution of the NSW Assembly specifically requests the ICAC to report `on what measures might be taken in respect of regulating or limiting the employment of MPs to provide advice on public affairs' 97 and requested that the ICAC specifically consider provisions in the UK House of Commons and Scotland. Neither of these parliaments have provisions that have the effect of limiting secondary employment of any particular kind except for paid advocacy, and in the case of Scotland, paid advocacy and paid employment as a parliamentary strategist or adviser. The other models considered - the Ontario Assembly and the Canadian House of Commons - similarly did not prohibit secondary employment in `public affairs', except for senior Members who are generally prohibited from holding any type of secondary employment.
The British House of Commons model quite clearly allows `paid advice work' - which would include public relations and public affairs type work - providing that the rules and regulations for declaration and registration of interests are adhered to (i.e. provision of details in a register and provision of the written contract between the employer and the client setting out the services to be provided).
On the basis of the experience of other jurisdictions it would appear the preferred method for dealing with secondary employment, which includes giving advice on `public affairs', is by:
· more rigorous disclosure regimes;
· the provision of detailed guidance and instruction to assist Members; and
· systems to enforce the rules of disclosure and registration.
Furthermore, the overseas parliaments considered have had significantly greater experience in terms of developing systems to deal with these types of issues and there is evidence that overall the British House of Commons model has improved standards within the Parliament.98 However this does not mean that the NSW Assembly could not consider developing its own provision to regulate or limit secondary employment in the area of `public affairs'.
In order to limit secondary employment in the area of `public affairs' there would need to be a reasonably common acceptance of what would be covered by that term. The letter from the ICAC Commissioner to all Members of the Assembly asked:
What do you understand to be professions or professional activities employed to provide advice on `public affairs'?
It is evident from the responses received, that there is not a widely shared understanding of what would be covered by `public affairs'.
The responses included definitions of public affairs and public advisers or officers, as well as examples of professions that were considered to have a role in public affairs. These examples included lobbyists, political consultants, general counsel, academics, administrators, economists, lawyers, accountants, public relations professionals, sociologists, public policy advisers and journalists.
A number of respondents stated that they considered that public affairs concerned the provision of strategic advice, information or research in areas such as economics, social and public policy or communication. One respondent stated:
Public Affairs advice comprises any information, opinion, debate or other communication designed to change or reaffirm or influence the position or impending or future decision of any authority on any issue affecting the public or any part thereof.
Another respondent noted that the definition of public affairs could be interpreted differently by individuals and organisations based on their own interests. Another stated `public affairs could be a component of almost any professional, manufacturing, industry, resource or creative activity'.
One respondent provided a suggestion as to how to define `public affairs', `public affairs-related employment' and `public affairs-related services'.
1. `Public affairs' means:
(a) any matter, issue or topic which may be brought to the notice of Parliament by any Member of Parliament or is capable of being brought to the notice of Parliament by any Member of Parliament; or
(b) any matter which is the subject of administration by a state government agency or local council or is capable of being administered by a state government agency or local council; or
(c) any matter which is the subject of consideration by a minister or group of ministers for the purpose of making policy or initiating legislation in relation to that matter.
2. `Public affairs-related employment' means employment which may, inter alia, involve the provision of services, including but not limited to information, advice, research, communications and public relations services which relates to public affairs to a third party in return for remuneration.
3. `Public affairs-related services' means any services, including but not limited to the provision of information, advice, research, communications and public relations services which relates to public affairs.
It is clear from the responses received by the ICAC that any attempt to define public affairs, with a view to prohibiting it, would be problematic. Further, almost any type of secondary employment, may conflict, or be seen to conflict, with a Member's parliamentary duties so it raises the broader issue of establishing a disclosure regime that deals with all types of secondary employment.
Based on the discussion above and the experiences of other jurisdictions, refining the current system of disclosure and registration may be an effective and acceptable way to deal with the issues identified in the resolution. This would avoid the problems and obstacles that will inevitably result from defining and interpreting `public affairs' and would promote a more transparent and accountable framework that could deal with all perceived or actual conflicts arising from any secondary employment.
The Assembly should be aware of the possibility that any type of secondary employment may create or appear to create an obligation or duty in conflict with the Member's duty to the Parliament and his or her constituency. It is apparent that all interests arising from secondary employment need to be appropriately declared and managed, especially where such interests have the potential to be in conflict with the parliamentary duties and activities of a Member.
RECOMMENDATION 1 - REFORMS FOR ALL TYPES OF SECONDARY EMPLOYMENT
That the New South Wales Legislative Assembly consider provisions for appropriate declaration and management of all forms of secondary employment and the extent to which they may conflict, or appear to conflict, with a Member's parliamentary duties.
Guidelines and principles for Members of the Legislative Assembly
In considering the current Code, Members of the Assembly were asked:
Do you believe the present Code of Conduct applying to Members of your House to be adequate in its handling of issues relating to the secondary employment of Members of Parliament in the `public affairs' field?
Two thirds of those who responded to this question believed the Code is adequate in this respect, while the others believed that disclosure and management of outside interests was manifestly inadequate and needed to be better governed by the Code of Conduct and applicable legislation.
The question of improving the disclosure regime in respect of secondary employment is discussed later in this chapter. However, it is possible that comments by Members that the Code is not adequate to deal with outside interests may in part relate to the lack of other documentation which sets out how the Code and other rules that apply to the conduct of Members, such as those prescribed under the Constitution Act and the Regulation, operate in practice and how they should be interpreted. Where the Code and other rules are vague and subject to interpretation, it leaves it to the Members themselves to interpret what the rules mean or imply.
It is worth noting that the NSW Parliament's Code of Conduct is very similar to that used in the British House of Commons - both are aspirational documents that set out the values and broad principles that should underpin the conduct of MPs. However, the significant difference between the Assembly and the British House of Commons is the Guide to the Rules relating to the Conduct of Members that accompanies the House of Commons' Code of Conduct. It sets out in detail how the Code and other rules should be interpreted, the legislation and resolutions that underpin the rules, and it provides examples of what should and should not be disclosed and how, if disclosure is needed, that disclosure should be made (e.g. through register and before proceedings). It covers the minutia of how the rules and the disclosure regime operate in practice.
The NSW Legislative Assembly has no such equivalent document and, without adopting a detailed Code of Conduct like that used in the Scottish Parliament (which is some 87 pages long), the solution to address this issue would be to establish a document similar to the Guide to the Rules relating to the Conduct of Members. This would not only clarify the operation of the Code and other rules, but bring a level of transparency as to what is required of MPs.
Finally, it was noted that the Assembly's current Conduct of Conduct does not include a comment specifically addressing the public duty and primary obligation of Members. By contrast, the Scottish Code explicitly states that:
Members' primary obligation is to act in the interests of the Scottish people and their Parliament. In doing so, members have a duty to uphold the law and to act in conformity with the rules of the Parliament.99
Similarly the British House of Commons has a general principle on `public duty'.
The ICAC is of the view that it is important that there is an underpinning principle in the Code of Conduct which makes it explicit that MPs owe their primary obligations to their constituents and the people of New South Wales. Such a principal should underpin any framework for the regulation of parliamentary standards - not just those that relate to conflicts of interest arising from secondary employment.
RECOMMENDATION 2 - GUIDE TO ASSIST MEMBERS ON CONDUCT AND DISCLOSURE
That the New South Wales Legislative Assembly consider the development of a guide, similar to the British House of Commons' Guide to the Rules relating to the Conduct of Members, to assist Members in understanding and applying the Code and any other rules relating to the conduct of Members, including those set out in the Constitution Act 1902 and the Constitution (Disclosures by Members) Regulation 1983.
RECOMMENDATION 3 - ADDITIONAL PRINCIPLE FOR THE CODE OF CONDUCT
That the New South Wales Legislative Assembly consider an amendment to the Code of Conduct to include an additional principle or responsibility which sets out that a Member's primary obligation is to their constituents, and to the people of New South Wales.
Paid advocacy
It is clear that most other parliaments considered in this report prohibit paid advocacy. Paid advocacy is where Members receive a personal benefit (cash or otherwise) to take up a cause in the Parliament. In the jurisdictions that prohibit paid advocacy, the sanctions and/or penalties for engaging in this type of activity are serious. For example:
· British House of Commons - the consequences for a Member range from being required to apologise to the House to expulsion. As well a Member can be suspended or have their salary withheld without suspension.
· Scottish Parliament - the consequences for a Member range from being excluded from proceedings to being found guilty of an offence and liable for a fine up to 5000 pounds.
· Canadian House of Commons - a Member is found guilty of an offence and liable to a fine of not less than $500 but no greater than $2000 and is disqualified from being a Member of the House of Commons for five years after a conviction for that offence.
This issue is addressed in clause 2 of the NSW Code of Conduct which directs Members not to promote views, ask questions or vote on legislation in return for payment or other direct financial benefit. However, this clause is headed `Bribery', thereby implying that it is confined to the criminal offence under the Crimes Act 1900. It should be made clear that this section of the Code also refers to paid advocacy.
The ICAC agrees that there is no legitimate justification for allowing Members of Parliament to be paid by external parties for undertaking activities in the Parliament, such as asking questions, making speeches or voting on legislation. Accordingly, the ICAC recommends that the NSW make specific provisions to prohibit paid advocacy. Following the model used in the overseas parliaments, and given the serious nature of engaging in paid advocacy, a breach of the rule should formally be grounds for the House to expel a Member from Parliament. In implementing this recommendation the House should give detailed consideration to the issues that have confronted the British House of Commons and the Scottish Parliament, in particular, in developing a paid advocacy rule. In determining specific details for the operation of a paid advocacy rule, careful consideration should be given as to how to define it, and how it would apply to proceedings in Parliament (e.g. initiating, participating and voting) and to preparatory work for proceedings in Parliament.
It is interesting to note the Scottish model, unlike the other models, directs MSPs to not accept payment for services as a parliamentary strategist, adviser or consultant. This type of work, whilst not paid advocacy, does involve advising on parliamentary affairs and on how to influence the Parliament and its Members. There are strong reasons for prohibiting this type of employment because of the nature of the work itself and the clear potential for conflict it raises. Advising a constituent or group of constituents on how best to progress an issue through Parliament is arguably advice the Member should provide for free. In NSW the work of MPs is described in the following way:
The work of Members includes much more than debate in the Chamber or serving on Parliamentary Committees. They make representations to Ministers and officials of Government departments on issues affecting the people of NSW. Sometimes these issues may affect only a small group with a particular interest. At other times the issue may affect people across the whole state, for instance a drought or an industrial dispute. They also:
- consult on issues under review by the Committees or before voting on Bills (legislation),
- bring issues to the attention of the media and make public statements to express their opinions,
- manage their office and research staff, and
- attend functions and speak to groups, clubs or organisations.Some Members also have special responsibilities such as being a Minister or Shadow (Opposition) Minister of a portfolio (eg: the environment), or have special responsibilities within their party.100
It is reasonable to expect that in dealing with their constituents' interests, a Member would not only make representations but would also provide advice to their constituents or constituency groups on action they can take - other than through their local member - to promote their issue or cause in the Parliament. There may, however, be circumstances where a Member could be employed by a private interest group or organisation (as opposed to a constituent or group of constituents) to provide parliamentary strategy advice. In these cases the stricter disclosure regime proposed later in this chapter regarding secondary employment arising from a Member's position as a MP should apply.
The ICAC is of the view that the NSW Assembly should consider the particular situation of secondary employment as a parliamentary strategist, adviser or consultant and determine whether this type of secondary employment should be prohibited or should be allowed within the current disclosure regime.
Although the Assembly's resolution refers to `public affairs', the ICAC considers that work as a parliamentary strategist - which arguably falls within a definition of `public affairs', like other employment such as public policy adviser or public relations consultant - is a type of secondary employment that warrants special attention by the Parliament.
RECOMMENDATION 4 - DEFINING PAID ADVOCACY IN THE CODE OF CONDUCT
That the title of clause 2 in the Members' Code of Conduct be amended to read `Bribery and Paid Advocacy' to reflect the fact that the description of activities contained in that clause is not confined to bribery.
RECOMMENDATION 5 - PROHIBITING PAID ADVOCACY
That paid advocacy be prohibited in the New South Wales Legislative Assembly and that a breach of this rule be grounds for the House to expel a Member of Parliament. This provision should be enforced by way of either a resolution of the House or amendment to legislation, and in developing a definition, the Assembly should give careful consideration to the experiences in the British House of Commons and the Scottish Parliament.
RECOMMENDATION 6 - PAID PARLIAMENTARY STRATEGIST, ADVISER OR CONSULTANT
That the New South Wales Legislative Assembly consider the particular situation of secondary employment as a parliamentary strategist, adviser or consultant and determine whether this type of secondary employment should be prohibited or should be permitted within the current disclosure regime.
Disclosure and the register of pecuniary interests
Detail of disclosure
With the exception of provisions concerning paid advocacy and parliamentary strategist work, the disclosure requirements in place in the overseas parliaments considered and the Assembly are broadly similar. All the parliaments, for example, require disclosure of secondary employment and directorships.
Where the jurisdictions differ is in the level of detail required when making declarations and registrations, as outlined in preceding chapters.
The NSW Constitution Act and the Regulation, as outlined in Chapter 2, provide the basic disclosure requirements for the Assembly. They do not, however, cover particular issues (addressed in other jurisdictions) relating to consultancies nor do they require the same level of detail observed in the overseas jurisdictions. While the Regulation does, for example, state that members are to provide a description of their occupation in respect of secondary employment, it remains silent on how extensive that description should be, and there are no additional guidelines to assist members in doing this. To assist in preparing this report, the ICAC examined the 2001-2002 Register of Disclosures by Members of the Assembly101 to better understand how the scheme works in practice.
That examination highlighted some inconsistency in the information Members actually disclose. For example, some Members enter their parliamentary salary into `other sources of income' while others do not. Given the purpose of the register is to disclose interests that may come into conflict with a Member's parliamentary duties, it would seem unnecessary for Members to declare their parliamentary salaries.
It was also observed that there is a general lack of detail in the description of secondary employment undertaken by Members. No specific information about the work being undertaken is required. In most cases, the name or title of the occupation or work being undertaken is given rather than an actual description - examples from the 2001-2002 register include `solicitor', `consultant', `consultant solicitor', `contributor' with name of employer suggesting a media publication, `director', and `importer'.
These descriptions do not provide sufficient information to enable a determination of whether or not a Member could potentially have a conflict of interest. While it is ultimately a matter for the Member to ascertain whether he or she has an actual or perceived conflict of interest and to deal with it appropriately, the purpose of the register is to facilitate accountability and transparency - that is one of the reasons the register is open to the public. However, if the entry in the register is vague or meaningless, this purpose is defeated.
The ICAC is of the view that greater detail should be required and provided in the register in respect of all forms of secondary employment. The ICAC considers that Members should be required to provide a description of secondary employment that is detailed enough that a member of the public could discern what the Member actually does in their secondary employment - for example, `consultant' tells very little about the actual services being provided or the work being undertaken, whereas `consultant providing services to public and private sector clients on topics relating to corporate risk assessment and management; internal audit planning, and corporate policy on risk' is much more informative. This requirement would not be too onerous as disclosure is only required when the Member takes his/her oath or affirmation or when a Member's secondary employment changes. Furthermore, only a few Members actually have secondary employment - the 2001-2002 register indicates approximately 18 Members declared receiving income from secondary employment.
Disclosure before proceedings in Parliament
The British House of Commons, the Scottish Parliament and the Ontario Legislative Assembly models require Members to not only disclose interests in a register but to disclose interests prior to the proceedings in Parliament where the Member is aware that the proceedings may relate to the interests of their secondary employer or, in some cases, any former secondary employer. The purpose of declarations in the House of Commons is explained in the following way.
The main purpose of declaration of interest is to ensure that fellow Members of the House and the public are made aware, at the appropriate time when a Member is making a speech in the House or in Committee or participating in any other proceedings of the House, of any past, present, or expected future pecuniary interest which might reasonably be thought to be relevant to those proceedings.102
The ICAC supports this approach in dealing with disclosures, although, like the advocacy rule, careful consideration should be given to the experience of the overseas jurisdictions in developing the details for the operation of such a rule - for example, such a rule could apply to initiating, participating or voting, or only some of those activities. It would also need to be considered whether disclosure in itself is sufficient, or whether disclosure should prohibit the Member from a particular activity (e.g. initiating proceedings). These are the details that should be developed and decided upon by the House.
Furthermore, the ICAC is of the view, based on the practices of some of the overseas jurisdictions, that the disclosure before proceedings in Parliament, should apply not only to current secondary employment, but also to past secondary employment where a reasonable person would consider that the work or activities formerly undertaken would appear to conflict with the topic of the current proceedings. The application of this rule in respect to former secondary employment would need to consider factors such as how recently the secondary employment was undertaken or completed.
Secondary employment arising from a Member's position as a MP
The ICAC also considered the House of Commons' provisions dealing with paid employment which depends essentially upon, or arises out of, the Member's position as a MP (refer to the discussion on pages 36 and 37 concerning clients and to category 3 of the Guide for Members). In such cases, Members are required to list all individuals/organisations to which the Member's services are provided, together with a description of the nature of the client's business in each case.
We are of the view that the Assembly should adopt a similar provision and it should apply regardless of the type of secondary employment the Member is engaged in, for example, self-employment, or working in a partnership or for a company or association. As is the practice in the House of Commons, the NSW provision should not apply when the Member has clients in his or her non-parliamentary professional capacity (e.g. doctor, lawyer, accountant), provided it is clear beyond reasonable doubt that the services provided do not in any way arise out of or relate in any way to membership of the Assembly.
In cases where a Member is engaged by a company or where the Member is a Director of a company which in itself is a consultancy, or where that employment or position arises from the Member's position as an MP, then the Member should also be required to disclose those of the consultancy's clients with whom he or she has a personal connection or who benefit from the Member's advice and services. This provision would address a gap in the current regime whereby a Director provides services to the client of the company, but does not have to declare the provision of services because the Company, not the individual Director, is paid by the client. The Director is currently only required to disclose his or her Directorship and dividends from the Company.
The House of Commons scheme requires that if a Member performs work for a client which essentially results from the Member's position as a Member of Parliament, and the benefit exceeds one per cent of their parliamentary salary, then the Member is to ensure that any such agreement is in writing and deposited with the Parliamentary Commissioner (see discussion on page 37).
The ICAC is of the view that such agreements should be required in writing and that they should be accessible for the purpose of investigating any matter relating to a Member's secondary employment. In the absence of a Parliamentary Commissioner (with whom such agreements are deposited in overseas parliaments) the ICAC recommends that the Assembly determine how and with whom these agreements are to be deposited so that they are accessible for the purposes of investigation if required.
In order to both ensure that Members comply with disclosure requirements and that the written disclosures are accessible, the ICAC suggests that Members be required to enter details of all secondary employment arising from a Member's position as an MP on the pecuniary interests register, and that where the terms of this employment meet the Parliament's criteria for the Member to enter into a written agreement, that this agreement also be entered into with the employer within 21 calendar days of the Member agreeing to undertake the relevant secondary employment. Furthermore, the register itself should include a field which indicates whether a written agreement is required or not for that employer and if so, the date that contract was entered into.
RECOMMENDATION 7 - GREATER DETAIL IN THE REGISTER OF PECUNIARY INTERESTS
That Members undertaking secondary employment should be required to provide a description of the services being provided and/or activities being undertaken, and that the description should be sufficiently detailed that a reasonable person would have an understanding of the actual work being performed by the Member on inspection of the register.
RECOMMENDATION 8 - DECLARING CONFLICTS OF INTERESTS BEFORE PROCEEDINGS IN PARLIAMENT
A Member should be required to disclose a conflict of interest at the start of any proceedings in Parliament which relate to the interests of any employer, association or client who has employed, or is currently employing, the Member. In developing the detail for the operation of a disclosure-before-proceedings rule, consideration should be given to the experience in the British House of Commons, the Scottish Parliament and the Ontario Legislative Assembly.
RECOMMENDATION 9 - EMPLOYMENT ARISING OR RELATING TO MEMBERSHIP OF THE PARLIAMENT
Where a Member is engaged in secondary employment which depends upon, or arises out of, the Member's position as an Member of Parliament, that this should be indicated in the pecuniary interests register. The Member should be required to list all individuals/organisations to which the Member's services are provided, with a description of the nature of the business of the employer, client, or association in each case.
Further to this provision, where the Member is engaged by a company or where the Member is a Director of a company which in itself is a consultancy, then the Member should also disclose those of the consultancy's clients with whom he or she has a personal connection or who benefit from the Member's advice or service.
Further to this provision, where the income received from the employer, client, or association exceeds one per cent (1%) of the Member's parliamentary salary, then the Member should be required to enter a written agreement that outlines the services to be provided and/or activities to be undertaken. Members should be advised that these agreements should be accessible for the purpose of investigating any matter relating to a Member's secondary employment. The Assembly should determine how and with whom these agreements are to be deposited so that they are accessible for the purposes of investigation if required.
The pecuniary interests register should specify whether the secondary employment reaches the threshold of requiring a written agreement with the employer, and if so the date the agreement was entered into. Members should be required to enter into such agreements within 21 days of agreeing to the secondary employment.
Maintenance of the register of interests
Presently, the Regulation requires Members to make two types of returns (i.e. disclosures): a primary return within three months of becoming a Member; and an ordinary return which is an annual return, usually for the period ending 30 June of the year and due to the Clerk of the House by 1 October each year (clause 5 and 6). This requirement applies to both the Legislative Council and Legislative Assembly and to all registrable interests set out in the Constitution Act and the Regulation.
Where a Member wishes to make a declaration of changed circumstances in respect of any registrable interest outside of those two reporting periods, they are advised by the Clerk that it is not possible to alter or update their declaration, but that a copy of their letter advising the changes will be filed alongside their declaration. The changes in a Member's interests are not tabled until one of the two reporting periods (i.e. after becoming a Member or after 30 June each financial year).
The register itself is simply a collation of the forms submitted by Members for the primary and ordinary returns. The register is divided into two parts; the first for the collation of primary returns and the second for ordinary returns. The returns in each section are filed in alphabetical order according to the surnames of the Members concerned.
The current register (i.e. for the current financial year) is available for inspection by any member of the public but only by attending the Office of the Clerk and inspecting the physical register. However, after 30 June of each year, the Clerk does authorise the previous register (i.e. for the previous financial year) to be copied and bound, and this document can be sent to members of the public who cannot attend the Office of the Clerk.
However, the benefits of having the register and of requiring disclosures to be updated expeditiously are negated if that information is not provided to the House and to the public in a timely fashion. The principal feature of the register is that it is a public document - it is not just an instrument of compliance for Members, it exists so the members of the public are informed of what interests and potential conflicts a Member has, and it holds Members accountable to the public in ensuring their private interests do not conflict with their parliamentary duties and obligation to their constituents.
It would be illogical to limit any requirement to disclose changes in material interests within a specified period of time to secondary employment issues only. The ICAC is of the view that any such provision should apply to all registrable interests if the purposes of having the register are to be adequately addressed. Similarly, the ICAC is of the view that such a provision should apply to both houses of the NSW Parliament. Finally, under the rules as set out in the Constitution and the Regulation which apply to Members of both Houses, it would require a significant change to those statutory instruments to create a different disclosure regime for each House. Therefore the discussion and recommendations following refer to all Members of the NSW Parliament.
The ICAC is of the view that Members of the NSW Parliament should not only be given the ability to update their register of interests, but indeed, that there should be a clear obligation to do so. It is suggested that a reasonable period of time following a material change in a Member's interests be allowed for the Member to update the register - based on the practices of the British House of Commons and the Scottish Parliament it would be realistic to expect that Members disclose a change in their interests within 30 calendar days of that change occurring.
It is not only important that the register be updated in a timely fashion, but that the House is also advised of such changes. Therefore it is recommended that the Clerk of the Assembly table a copy of new disclosures in the House at the commencement of each sitting period after a disclosure has been received.
It must be acknowledged that the current form of the pecuniary interest register (i.e. a compilation of paper forms) would need to be changed to support a system where the register itself is continually being updated. It will be necessary for the Parliament to consider establishing an electronic register which can be easily updated and easily accessed. It is not just important for the public to be able to access an up-to-date register; Members and their staff should also be able to examine the register and ensure their register is current.
Therefore it is recommended that consideration be given to updating the current pecuniary interest register to an electronic format which can be easily updated and accessed. The register should be made available to the general public and Members via the Internet as is done for the register in the House of Commons. The Clerk of the House should be required to update the database within seven days upon receipt of a form from a Member stating a new interest or change in a current interest.
It is acknowledged that disclosure requirements are detailed in the Constitution Act and the Regulation, so modifications to the current scheme will need to be given force by amendment to the legislation. In addition, another form will be required, under Schedule 1 of the Regulation for Members, to inform the Clerk of new interest or changes to current interests.
Finally, in reviewing the operation of the pecuniary interests register, the ICAC observed that the forms in Schedule 1 of the Regulation (see Appendix E) are poorly designed and are not user-friendly. Therefore it is recommended that in reviewing the systems supporting the maintenance of the register that consideration also be given to the redesigning the current forms set out in Schedule 1.
RECOMMENDATION 10 - UPDATING THE REGISTER OF PECUNIARY INTERESTS
That Members of the NSW Parliament be required to register any new interests, or changes in current interests within 30 calendar days of the new interest commencing or a current interest being amended.
That the register of pecuniary interests be updated within seven days of receipt of documentation of a new interest or amendment to a current interest and that those changes be tabled in the Parliament at the commencement of the next sitting period.
RECOMMENDATION 11 - ESTABLISHMENT OF ELECTRONIC DATABASE OF THE REGISTER OF PECUNIARY INTERESTS
That the register of pecuniary interests be established as an electronic database that can be accessed via the Internet by Members of Parliament and members of the public.
RECOMMENDATION 12 - REVIEW OF FORMS UNDER SCHEDULE 1 OF THE REGULATION
That in undertaking a review of the pecuniary interests register, that a new form be developed to allow Members to advise of a material change in interests, and that the current forms under Schedule 1 be redesigned to improve usability.
Enforcement and investigation of breaches by Members
The ICAC has given careful consideration to methods of enforcement and investigation of breaches of the Code of Conduct and requirements of the register of pecuniary interests. In doing this we reviewed the models in use in the British House of Commons, the Scottish Parliament and the Ontario Legislative Assembly, which all have Parliamentary Commissioners to investigate breaches. We also reviewed the Commissioner model being considered by the Canadian House of Commons. However, it must be kept in mind that these parliaments do not have the equivalent of the ICAC, so the Parliamentary Commissioners conduct all investigations that relate to breaches of the Code of Conduct and breaches of any relevant rules or laws relating to conduct.
In NSW, the ICAC has the jurisdiction to investigate allegations of corrupt conduct that could amount to a `substantial' breach of the Code of Conduct, so it is not necessary to establish another office or position that replicates that function. However there are those infrequent cases where a Member is alleged to have committed a `substantial' breach of the Code but the conduct in question is protected by parliamentary privilege (see discussion on page 27).
The prohibition on the ICAC to conduct these types of investigations reflects the commonly-held position in Westminster-style parliaments that the affected House should be responsible for enforcing its own privileges and immunities. These responsibilities are fiercely guarded by these parliaments. Unless the NSW Parliament were to take a significantly different view from its counterparts, the ICAC is unlikely to be given such legislative authority as would be necessary to question or rely upon proceedings in Parliament as the basis of an investigation into corrupt conduct. However, a limiting provision that could be provided would be an amendment to the ICAC Act to include a new Part which allows the Parliament to waive parliamentary privilege for specific matters which are referred to the ICAC by resolution of the House. The ICAC is of the view that such a resolution should not be required by both Houses because each House is responsible for the conduct of its Members, and for the deciding what action should be taken to deal with a Member who has breached a rule of the House. Finally, in considering such an amendment, it should be noted, as was discussed on page 27, the question of whether parliamentary privilege could be waived in such a way that could compel an uncooperative member to give evidence to the ICAC remains untested and there are differing opinions on the issue.
Another avenue for dealing with these types of allegations, is to establish a Commission of Inquiry under the Special Commissions of Inquiry Amendment Act 1997. However, like the ICAC, any such Special Commission would require a legislative amendment to waive parliamentary privilege. Alternatively the Parliament could, for particular matters, re-enact Part 4A of the legislation which allows the Parliament to waive privilege by resolution. As discussed on page 27, this Part waives privilege in relation to a Member wishing to give evidence on a voluntary basis to a Commission of Inquiry, however a Member can still lawfully refuse to give evidence on the basis of parliamentary privilege under this Part. If an amendment of this type is considered, it would appear more efficient to make it applicable to the ICAC, which is a Standing Commission of Inquiry, rather than establish a Special Commission of Inquiry for each new allegation.
For a model of regulation to be considered meaningful it must be able to be effectively enforced. There cannot be gaps in the model that allow particular types of misconduct to be protected from investigation. An alternative way of dealing with such a situation which does not involve a Commission of Inquiry is to appoint a parliamentary committee to conduct the investigation. An example of this in the NSW Parliament was the Legislative Council Standing Committee on Parliamentary Privilege and Ethics* that, in the last Parliament, conducted an inquiry that was established by a resolution of the Legislative Council. That resolution requested the Committee to investigate and report on the conduct of a Member in respect of complying with the requirements of the register of pecuniary interests.103
_ This Committee has not yet been constituted in the current (53rd) Parliament.
However the use of Parliamentary Committees to conduct investigations can be problematic, as was noted by the House of Commons Committee on Standards and Privileges in 1998 when considering this issue:
It seems to us most unlikely that busy Members - particularly senior Members - would be able to devote the time to what may be a long and complicated inquiry. The experience of the former Members' Interests and Privileges Committees indicates that select committees are not particularly well-equipped to carry out tasks of this kind: indeed the perceived shortcomings of inquiries carried out by these committees was one of the considerations which lay behind the Nolan Report's recommendation that the post of Parliamentary Commissioner for Standards be created104. Most seriously, perhaps, any inquiry conducted by politicians is likely to be seen by many people - rightly or wrongly - as partial, party-political, or lacking in objectivity and independence.105
It would appear that some experiences in the UK House of Commons are similar to those of the NSW Legislative Council Standing Committee on Privileges and Ethics in conducting their inquiry into the pecuniary interests register. The NSW Committee commented that:
This was always going to be a difficult inquiry due to...the fact that 8 Members of the Legislative Council, representing four political parties and one independent Member, have been effectively asked to sit in judgement upon another Member, who is a senior Minister in the Government...
This was an important inquiry for the Legislative Council. The report will be no doubt be looked at as a precedent for subsequent considerations of failures to comply with pecuniary interest disclosure requirements, not only in this Parliament but also in other Parliaments throughout Australia and overseas. It is therefore extremely disappointing that this report is, in my view [being the Chairperson of the Committee] so inadequate and `politicised'....106
Similarly, the Canadian House of Commons, as discussed on pages #-# formed the view, based on the experiences of the British House of Commons, that a committee may not be `an effective mechanism to conduct a detailed, factual inquiry in which an individual's rights and reputation may be at stake, and in which procedural fairness is important'.
Where a particularly serious allegation has been made against a Member but where parliamentary privilege protects that conduct from an ICAC investigation, the Assembly must be seen to be deal with that matter in a way that is fair, balanced, and non-partisan. The alternative to the creation of a parliamentary committee for this purpose would be the establishment of a Parliamentary Commissioner position similar to that which has been adopted in the British House of Commons, the Scottish Parliament, the Ontario Legislative Assembly and is being considering in the Canadian House of Commons.
The ICAC considered whether the situation in NSW warrants a permanent, full-time or part-time Parliamentary Commissioner. The ICAC is of the view that it does not for a number of reasons. Unlike the overseas parliaments where the Parliamentary Commissioner deals with all complaints relating to Members' conduct, in NSW the situation differs because of the existence of the ICAC which can investigate corrupt conduct allegations - apart from those to which parliamentary privilege applies - which could amount to a `substantial' breach of the.
By way of comparison, the number of complaints received by the British House of Commons Commissioner (the House has 659 Members) is quite high (e.g. 137 in 2000-01; 118 in 2001-02, 67 in 2002-2003) although the declining numbers means that the prevention and advisory roles of the position have become correspondingly more important. The NSW Legislative Assembly has only 93 Members, and based on previous experience the number of complaints of corrupt conduct that could amount to a `substantial' breach of the Code of Conduct, and that would fall outside the jurisdiction of the ICAC because the conduct is protected by parliamentary privilege is very low (e.g. one complaint of this type in 2002-2003, and none in 2001-2002).
Therefore the ICAC has formed the view that it is not necessary to establish a permanent office of Parliamentary Commissioner. It is, however, important that the House formally set out what action it would take in the circumstance where it is alleged that a Member has committed a serious breach of the Code that is protected by parliamentary privilege.
The action recommended by the ICAC - as an alternative to amending the ICAC Act to allow it to conduct such an investigation - is that in such cases an officer of the Parliament be appointed to the Legislative Assembly to undertake an investigation. An appointment to the Assembly would be necessary as the Assembly presently does not have a standing privileges committee, with questions of privilege traditionally dealt with by the entire House. In addition, the ICAC is of the view that direct reporting to the House by the officer of the Parliament, rather than to a Committee, is preferred because of the experiences in the British House of Commons and the Canadian House of Commons. This is not to say that there should not be a committee to review and/or monitor the operation of parliamentary privilege or of the operation of the pecuniary interests register, but the ICAC is of the view that such a committee should not have an investigative role.
The recommended procedure would provide a means for the Parliament to enforce its own privileges in such a way as to ensure public confidence in the integrity and impartiality of the outcome yet still maintain the independence and self-regulation of the House.
The appointment of an officer to serve the Assembly in this way may give rise to suggestions that the officer may be deliberately or inadvertently affected or influenced by the Members of the House. To overcome such suggestions, the House can provide certain safeguards in the appointment and duties of the investigating officer. The ICAC suggests that in addition to any other terms and conditions imposed by the Assembly, the position of the investigating official be subject to the following provisions:
· The official be appointed by means of a vote of the Assembly, with at least two thirds of the Members approving the appointment of the official. In most instances, given that any one political party is unlikely to constitute two thirds of the membership of the Assembly, this should pre-empt perceptions or accusations that the initial appointment was governed by political or partisan considerations.
· The official should be appointed for the purposes of investigating a particular matter and be subject to removal only upon a vote of the Assembly where any of the conditions for removal or vacation of the office of Commissioner of the ICAC have been met.
· To ensure the independence of the official, that person should not hold any other office of profit under the Crown, other than a pension or similar annuity.
· Once the official has received the terms of reference for the investigation from the House, the official should be subject only to such direction or instruction from the House as is necessary to efficiently conduct the investigation. It should be made clear that it is improper for the House, or any Member, to direct or attempt to direct the official so as to influence the outcome of the investigation.
· Given that the purpose of this post is to overcome the difficulty external bodies face in investigating possible breaches of parliamentary privilege, it will be necessary for the official to be given such powers and resources of the Parliament as are necessary to adequately carry out their functions. These powers and resources should be stipulated in the terms of appointment. At a minimum, the official should be able to compel the production of papers and documents, and compel the attendance of witnesses, and take evidence in accordance with parliamentary powers, subject to any general limits imposed by the Legislative Assembly at the time of appointment.
· The official should be required to provide his or her findings in a written report to the Assembly, which shall be tabled and made publicly available. The report should describe the investigation undertaken by the official, and would give the official the opportunity to report on any efforts to improperly direct or influence the direction or outcome of the inquiries undertaken.
In addition to the above, the ICAC is of the view that it is important that the official can not only make a finding as to whether a complaint is upheld, but should also be able to make recommendations as to what sanctions should be imposed on the Member. This is the practice in the Ontario Legislative Assembly and is being considered in the Canadian House of Commons.
Presently, the NSW Parliament has limited sanctions for dealing with breaches of the requirements for registration of interests. Where `wilful' failure has been established, this may form grounds for declaring the seat of a Member vacant, thereby removing the Member from the House. While this may be an appropriate sanction in some instances, it is by no means apparent that this is appropriate in every instance. There may be other sanctions, such as financial penalty or suspension from the House, which may constitute an appropriate means of dealing with a breach of the regulations concerning the interests of Members.
Consistent with the view that the House is responsible for enforcing its own privileges, the ICAC makes no specific recommendations on what may constitute additional appropriate sanctions, but rather, suggests that consideration be given by the Legislative Assembly to whether additional sanctions are appropriate, and if so, what form these may take and how they may be given force (i.e. through legislation and/or resolution).
RECOMMENDATION 13 - PROCEDURE TO DEAL WITH PARTICULAR ALLEGATIONS
That the New South Wales Legislative Assembly set down in procedure outlining the action it would consider to deal with a serious allegation of the breach of the Code of Conduct and/or of the pecuniary interests register where parliamentary privilege protects the conduct from investigation by the Independent Commission Against Corruption (ICAC).
The ICAC recommends two options:
Option 1: Amendment to the Independent Commission Against Corruption Act 1988 (ICAC Act) which allows the Parliament to waive parliamentary privilege for specific matters which are referred to the ICAC by resolution of the House (although such an amendment would most likely only extend to those Members who choose to give evidence to the ICAC on a voluntary basis).
Option 2: The appointment of an officer of the Parliament on a case-by-case basis to investigate particular matters. The following provisions should be included in the procedure to safeguard the independence of the investigating official:
· The official should be appointed by means of a vote of the Assembly, with at least two thirds of the Members approving the appointment of the official.
· The official should be appointed for the purposes of investigating a particular matter and be subject to removal only upon a vote of the Assembly where any of the conditions for removal or vacation of the office of Commissioner of the ICAC have been met.
· To ensure the independence of the official, that person should not hold any other office of profit under the Crown, other than a pension or similar annuity.
· Once the official has received the reference for the investigation from the House, the official shall be subject only to such direction or instruction from the House as is necessary to efficiently conduct the investigation. It should be made clear that it is improper for the House, or any Member, to direct or attempt to direct the official so as to influence the outcome of the investigation.
· The official should be given the powers and resources of the Parliament as are necessary to adequately carry out the investigation and these should be stipulated in the terms of appointment. At a minimum, it would be expected that the official would have the power to order the production of papers and documents, and compel the attendance of witnesses, and to take evidence in accordance with parliamentary powers, subject to any general limits imposed by the Legislative Assembly at the time of appointment.
· Where the official finds a breach has occurred, the official shall make a recommendation as to what sanction should be imposed by the House.
· The official should be required to provide his or her findings in a written report to the Assembly, which shall be tabled and made publicly available. The report should describe the investigation undertaken by the official, and would give the official the opportunity to report on any efforts to improperly direct or influence the direction or outcome of the inquiries undertaken.
In cases where the conduct of the investigation by the official, or the findings of the official are contested, the House should consider the appointment of an investigatory panel, similar to that of the British House of Commons.
Implementing the recommendations
In developing the recommendations in this report, the ICAC considered the means by which the Assembly could adopt the recommendation. In the majority of cases, recommendations can be dealt with through either:
· legislative amendment to the Constitution Act and/or Regulation; or
· resolution of the House.
However, the Constitution Act and the Regulation apply to Members of both Houses, and any amendments to those statutory instruments would need to be agreed to by both Houses. We are mindful that the request for this report was the resolution of the Assembly and not that of both Houses.
In view of the above, implementation by resolution then followed by legislative amendment if agreed by the Legislative Council, would appear be the most expeditious way to deal with the recommendations. However, we consider that it is a matter for the House as to how to implement any of the recommendations herein.
RECOMMENDATION 14 - IMPLEMENTATION OF RECOMMENDATIONS
That the New South Wales Legislative Assembly determine the most effective means of implementing the recommendations in this report - either by legislative amendment or by way of resolution of the House.
Chapter 6 endnotes
93 NSW Parliamentary Library Research Service. MP's Entitlements. Occasional Paper No. 8. 2002. Department of the Parliamentary Library. Remuneration of Members of the Parliament of Australia. Background Paper. 1998.
94 Committee on Standards in Public Life. First Report of the Committee on Standards in Public Life. Chaired by Lord Nolan. Cm 2850-I. Volume 1:Report. May 1995. HMSO: United Kingdom.
95 NSW Parliamentary Library Research Service. MP's Entitlements. Occasional Paper No. 8. 2002
96 Committee on Standards in Public Life. First Report of the Committee on Standards in Public Life. Chaired by Lord Nolan. Cm 2850-I. Volume 1:Report. May 1995, p. 23. HMSO: United Kingdom.
97 Hansard. NSW Legislative Assembly. 21 November 2002.
98 Committee on Standards in Public Life. Sixth Report - Reinforcing Standards - Review of the First Report of the Committee on Standards in Public Life. Chaired by Lord Neill of Bladen. CM4557-I. Volume 1:Report. January 2000. HMSO: United Kingdom.
99 The Scottish Parliament. Code of Conduct for Members of the Scottish Parliament, Revised 01-05-03,
p.3, paragraph 2.2.
100 Source: http://www.parliament.nsw.gov.au/prod/web/phweb.nsf/frames/members
101 Parliament of New South Wales. Register of Disclosures by Members of the Legislative Assembly 30 June 2002. Ordered to be printed 22 October 2002.
102 British House of Commons. The Guide to the Rules relating to the Conduct of Members, 2000, p. 2. Source:
http://www.parliament.the-stationery-office.co.uk/pa/cm200102/cmselect/cmstand/841/84101.htm.
103 Standing Committee on Parliamentary Privilege and Ethics. Report on inquiry into the Pecuniary Interests Register. 2002. NSW Parliament.
104 Committee on Standards in Public Life. First Report of the Committee on Standards in Public Life. Chaired by Lord Nolan. Cm 2850-I. Volume 1:Report. May 1995. HMSO: United Kingdom.
105 Committee of Standards and Privileges. 21st Report: Appeal Procedures. 1998. House of Commons: United Kingdom.
106 Standing Committee on Parliamentary Privilege and Ethics. Report on inquiry into the Pecuniary Interests Register. 2002, p. xi. New South Wales Legislative Council.
APPENDIX A - COMMENTS BY MEMBERS OF THE LEGISLATIVE ASSEMBLY
Letters were sent to all 93 Members of the Legislative Assembly in the 52nd (previous) Parliament.
Responses were received from 23 Members. Three of those responses were to acknowledge receipt of the correspondence or indicate an inability to provide a considered response in the timeframe afforded. Of the 20 substantive responses:
Five responses were received from Government members, including the Premier and the Deputy Premier (writing on behalf of the Government);
Thirteen responses were received from Opposition members, including eight from current
or former Shadow Ministers in the previous Parliament;
Two responses were received from cross bench members.
1. What do you understand to be professions or professional activities employed to provide advice on `public affairs'?
A range of responses was provided. These included definitions of public affairs and public advisors or officers, as well as examples of professions that were considered to have a role in public affairs. These examples included lobbyists, political consultants, general counsel, academics, administrators, economists, lawyers, accountants, public relations professionals, sociologists, public policy advisors and journalists.
A number of respondents stated that they considered that public affairs concerned the provision of strategic advice, information or research in areas such as economics, social and public policy or communication.
One respondent highlighted the conflict of interest that can occur for Members of Parliament when they are engaged to provide advice about public affairs:
MPs are elected to Parliament to represent the interests of their constituents. They are engaged in public affairs on behalf of their constituents and the people of NSW. This is a privileged position and MPs should not allow their public duty to be subverted to private interests...Taxpayers pay MPs to devote themselves to public affairs. MPs should not be able to exploit that position to obtain additional fees for doing the same job.
One respondent noted that the definition of public affairs could be interpreted differently by individuals and organisations based on their own interests.
2. In the light of your understanding of the concept of `public affairs', are you or have you ever been, whilst a Member of Parliament, employed or engaged in any capacity relating to `public affairs'?
Yes: 2
No: 17
Nineteen respondents provided a response to this question. Seventeen respondents stated that they had not been employed or engaged in public affairs while they were a Member of Parliament. one of the two respondents that answered `Yes', one had been engaged to provide public affairs advice through his family company and the other stated that she had rarely engaged in any secondary employment. The instances she cited are not the type of activity generally regarded as `public affairs' activity.
3. Do you believe the present Code of Conduct applying to Members of your House to be adequate in its handling of issues relating to the secondary employment of Members of Parliament in the `public affairs' field? If not, why not? What improvements would you suggest to be made to the Code in this respect?
Yes: 13
No: 6
Nineteen respondents provided a response to this question. Thirteen respondents stated that they considered that the present Code of Conduct was adequate in its handling of secondary employment in relation to public affairs. Of these, two respondents suggested that any review of the Code of Conduct should include all forms of secondary employment, including pecuniary interests.
Six respondents thought that the current Code of Conduct was not adequate to handle issues of secondary employment regarding public affairs. One respondent suggested that clearer guidelines were needed regarding secondary employment. Two respondents considered that the Code of Conduct should be reviewed, and that consideration should be given to codes of conduct in other jurisdictions. Issues that were considered to be important were transparency and conflicts of interest:
...the rules applying in the UK highlight the need for transparency in cases where secondary employment may depend upon the MP's role as a representative of the people...[the approach in Scotland] is premised on a view that no matter what disclosure requirements are in place, it will be difficult to ensure that MPs are not exploiting the privileged position for private gain
One respondent considered that the `Code of Conduct is totally inadequate in setting appropriate ethical standards for Members of Parliament and for ensuring that any breaches are properly investigated and dealt with'. This included a failure to deal with secondary employment. This respondent made a number of recommendations aimed at improving both the Code of Conduct, as well as the Constitution (Disclosures by Members) Regulation 1983. These recommendations concerned:
· amending the Code of Conduct to include a statement of MPs' duties and responsibilities
· banning outside employment except where it is compatible with the MP's functions, duties and responsibilities
· defining public affairs related employment as incompatible with the functions, duties and responsibilities of an MP
· amending the disclosure requirement of the Constitution (Disclosures by Members) Regulation 1983
· only permitting MPs to engage in secondary employment where there is a signed and witnessed contract between the MP and the party that has been lodged with Parliament.
4. Are there any other issues relating to this matter that you believe should be considered by the ICAC?
Six respondents provided further comments. The issues covered in these responses included:
· the need for MPs to make a disclosure when their income predominantly comes from one source
· the potential for a `draconian' code of conduct to be used against political opponents
· that belief that the work of an MP is full-time work and that all secondary employment should be banned
· the impracticality of banning some activities as secondary employment given that MPs come from all walks of life.
APPENDIX B - CODE OF CONDUCT - NSW PARLIAMENT
The following was adopted by the Legislative Assembly on 29 April 2003 at the commencement of the 53rd Parliament (Hansard, NSW Parliament).
PREAMBLE TO THE CODE OF CONDUCT
The members of the Legislative Assembly and the Legislative Council have reached agreement on a Code of Conduct which is to apply to all members of Parliament.
Members of Parliament recognise that they are in a unique position of being responsible to the electorate. The electorate is the final arbiter of the conduct of members of Parliament and has the right to dismiss them from office at regular elections.
Members of Parliament accordingly acknowledge their responsibility to maintain the public trust placed in them by performing their duties with honesty and integrity, respecting the law and the institution of Parliament, and using their influence to advance the common good of the people of New South Wales.
THE CODE
1 Disclosure of conflict of interest
(a) Members of Parliament must take all reasonable steps to declare any conflict of interest between their private financial interests and decisions in which they participate in the execution of their office.
(b) This may be done through declaring their interests on the Register of Disclosures of the relevant House or through declaring their interest when speaking on the matter in the House or a Committee, or in any other public and appropriate manner.
(c) A conflict of interest does not exist where the Member is only affected as a member of the public or a member of a broad class.
2 Bribery
Members must not promote any matter, vote on any bill or resolution, or ask any question in the Parliament or its Committees, in return for payment or any other personal financial benefit.
3 Gifts
(a) Members must declare all gifts and benefits received in connection with their official duties, in accordance with the requirements for the disclosure of pecuniary interests.
(b) Members must not accept gifts that may pose a conflict of interest or which might give the appearance of an attempt to corruptly influence the Member in the exercise of his or her duties.
(c) Members may accept political contributions in accordance with part 6 of the Election Funding Act 1981.
4 Use of public resources
Members must apply the public resources to which they are granted access according to any guidelines or rules about the use of those resources.
5 Use of confidential information
Members must not knowingly and improperly use official information which is not in the public domain, or information obtained in confidence in the course of their parliamentary duties, for the private benefit of themselves or others.
6 Duties as a Member of Parliament
It is recognised that some members are non-aligned and others belong to political parties. Organised parties are a fundamental part of the democratic process and participation in their activities is within the legitimate activities of Members of Parliament.
APPENDIX C - SECTION 14A CONSTITUTION ACT 1902
14A Disclosure of pecuniary interests and other matters by Members
(1) The Governor may, subject to subsections (4) and (5), make regulations for or with respect to:
(a) the disclosure by Members of either House of Parliament of all or any of the following pecuniary interests or other matters:
(i) real or personal property,
(ii) income,
(iii) gifts,
(iv) financial or other contributions to any travel,
(v) shareholdings or other beneficial interests in corporations,
(vi) partnerships,
(vii) trusts,
(viii) positions (whether remunerated or not) held in, or membership of, corporations, trade unions, professional associations or other organisations or associations,
(ix) occupations, trades, professions or vocations,
(x) debts,
(xi) payments of money or transfers of property to relatives or other persons by, or under arrangements made by, Members,
(xii) any other direct or indirect benefits, advantages or liabilities, whether pecuniary or not, of a kind specified in the regulations,
(b) prescribing the manner in which, and the times at which, pecuniary interests or other matters shall be disclosed and providing for the verification by statutory declaration or otherwise of any such disclosure, and
(c) the compilation and maintenance of registers of pecuniary interests or other matters disclosed by Members of either House of Parliament and the inspection and publication of any such register.
(2) If a Member of either House of Parliament wilfully contravenes any regulation made under subsection (1), that House may, in accordance with subsection (3), declare his seat vacant and the seat of the Member shall thereupon become vacant.
(3) A declaration under subsection (2) shall:
(a) specify the circumstances that constitute the contravention,
(b) declare that the House is of the opinion that the contravention is of such a nature as to warrant the seat of the Member being declared vacant, and
(c) be made in accordance with such Standing Rules and Orders of the House as may regulate the making of the declaration.
(4) A regulation shall not be made under subsection (1) for or with respect to the disclosure by Members of either House of Parliament of pecuniary interests or other matters unless it applies in the same way to the disclosure by Members of the other House of Parliament of pecuniary interests or other matters.
(5) The Governor shall, before making a regulation under subsection (1):
(a) afford any committee of either House of Parliament established for the purpose an opportunity of considering and making representations with respect to the proposed regulation, and
(b) take into account any such representations.
(6) Notwithstanding anything to the contrary in the Interpretation Act 1987 or any other Act, a regulation made under subsection (1), or any part thereof, shall not cease to have effect upon its disallowance by either House of Parliament unless it has previously been disallowed by the other House of Parliament.
(7) The publication, pursuant to any regulation made under subsection (1), of a register of pecuniary interests or other matters disclosed by Members of either House of Parliament shall, for the purposes of the Parliamentary Papers (Supplementary Provisions) Act 1975, be deemed to have been authorised by that House.
APPENDIX D - EXCERPTS FROM THE CONSTITUTION (DISCLOSURES BY MEMBERS) REGULATION 1983
9 Sources of income
(1) A Member shall disclose:
(a) in a primary return-each source of income which the Member reasonably expects to receive in the period commencing on the first day after the primary return date and ending on the next succeeding 30th June, and
(b) in an ordinary return-each source of income received by the Member at any time during the ordinary return period.
(2) A reference in subclause (1) to each source of income received, or reasonably expected to be received, by a Member is a reference to:
(a) in relation to income from an occupation of the Member:
(i) a description of the occupation,
(ii) where the Member is employed or the holder of an office-the name and address of his employer or a description of the office, and
(iii) where the Member has entered into a partnership with other persons-the name (if any) under which the partnership is conducted,
(b) in relation to income from a trust-the name and address of the settlor and the trustee, or
(c) in relation to any other income-a description sufficient to identify the person from whom, or the circumstances in which, the income was, or is reasonably expected to be, received.
(3) The source of any income need not be disclosed by a Member in a primary return or an ordinary return if the amount of the income received, or reasonably expected to be received, by the Member from that source did not exceed $500, or is not reasonably expected to exceed $500, as the case may be.
...
12 Interests and positions in corporations
(1) A Member shall disclose in a primary return and an ordinary return:
(a) the name and address of each corporation in which he had an interest or held any position (whether remunerated or not) on the primary return date or at any time during the ordinary return period, as the case may be,
(b) the nature of the interest, or the description of the position held, in each such corporation, and
(c) except in the case of a public company-a description of the principal objects of each such corporation.
(2) An interest, or position held, in a corporation need not be disclosed by a Member in a primary return or an ordinary return if the corporation is:
(a) formed for the purpose of providing recreation or amusement or promoting commerce, industry, art, science, religion or charity or for any other community purpose,
(b) required to apply its profits (if any) or other income in promoting its objects, and
(c) prohibited from paying any dividend to its members.
13 Positions in trade unions and professional or business associations
A Member shall disclose in a primary return and an ordinary return:
(a) the name of each trade union and each professional or business association in which he held any position (whether remunerated or not) on the primary return date or at any time during the ordinary return period, as the case may be, and
(b) the description of the position held in each such union or association
...
16 Discretionary disclosures generally
A Member may, at his discretion, disclose in any return any direct or indirect benefits, advantages or liabilities, whether pecuniary or not:
(a) which are not required to be disclosed by any provision of this Part, and
(b) which the Member considers might appear to raise a conflict between his private interests and his public duty as a Member or which he otherwise desires to disclose
...
18 Register of Disclosures by Members of the Legislative Assembly
The Clerk of the Legislative Assembly shall compile and maintain a register to be called the `Register of Disclosures by Members of the Legislative Assembly' in respect of disclosures of pecuniary interests and other matters made by Members of the Legislative Assembly pursuant to this Regulation.
19 Form of registers
(1) A register shall be in loose-leaf form and shall, at any time, comprise the returns lodged by Members within the previous 8 years.
(2) A register shall be divided into parts as follows:
(a) There shall be a separate part of a register for the primary returns lodged under clause 4.
(b) There shall be separate parts of a register for the ordinary returns lodged in respect of each ordinary return period, together with primary returns lodged under clause 5 in respect of primary return dates in that period.
(3) The returns filed in any part of a register shall be filed in alphabetical order according to the surnames of the Members concerned.
20 Inspection of registers
(1) A register shall be open to public inspection at the office of the Clerk required to compile and maintain the register between the hours of 10.00 am and 4 pm on any day except Saturday, Sunday or a day which is a public holiday throughout New South Wales.
(2) A register shall be open to inspection by Members at the office of the Clerk required to compile and maintain the register at any time the register is open for public inspection under subclause (1) and:
(a) in the case of the Register of Disclosures by Members of the Legislative Council-at any time the Legislative Council is sitting, or
(b) in the case of the Register of Disclosures by Members of the Legislative Assembly-at any time the Legislative Assembly is sitting.
APPENDIX E - SCHEDULE 1 (FORMS) OF THE CONSTITUTION (DISCLOSURES BY MEMBERS) REGULATION 1983
FORM 1
(Clause 3)
CONSTITUTION (DISCLOSURES BY MEMBERS) REGULATION 1983
PRIMARY RETURNS-LEGISLATIVE COUNCIL/ASSEMBLY
DIRECTIONS:
(1) The pecuniary interests and other matters required to be disclosed in this return are prescribed in clauses 8, 9, 12, 13 and 14 of the Constitution (Disclosures by Members) Regulation 1983.
(2) The particulars required to complete this form are to be written in block letters or typed.
(3) If any space is insufficient in this form for all the particulars required to complete it, attach an appendix for that purpose which is properly identified and signed by the Member.
(4) Where there are no pecuniary interests or other matters of the kind required to be disclosed under a particular main heading in this form, the word "NIL" is to be placed in an appropriate space under that heading.
DISCLOSURES OF PECUNIARY INTERESTS AND OTHER MATTERS BY
...................................................................... |
AS AT |
........................................ |
(full name of Member) |
(primary return date) | |
........................................ | ||
(Member's signature) | ||
........................................ | ||
(Date) |
A REAL PROPERTY
Address of each parcel of real property |
Nature of interest |
B SOURCES OF INCOME
1 Sources of income I reasonably expect to receive from an occupation in the period commencing on the first day after the primary return date and ending on the next succeeding 30th June:
Description of |
Name and address of |
Name under which |
2 Sources of income I reasonably expect to receive from a trust in that period:
Name and address of settlor |
Name and address of trustee |
3 Sources of other income I reasonably expect to receive in that period:
(Include description sufficient to identify the person from whom, or the circumstances in which, that income is expected to be received.)
C INTERESTS AND POSITIONS IN CORPORATIONS
Name and address of each corporation in which I had an interest or held a position on the primary return date |
Nature of interest (if any) |
Description of position |
Description of principal objects of corporation (except in case of public company) |
D POSITIONS IN TRADE UNIONS AND PROFESSIONAL OR BUSINESS ASSOCIATIONS
Name of each trade union and each professional or business association in which I held any position (whether remunerated or not) on the primary return date |
Description of position |
E DEBTS
Name and address of each person to whom I was liable to pay any debt on the primary return date.
F DISCRETIONARY DISCLOSURES
FORM 2
(Clause 3)
CONSTITUTION (DISCLOSURES BY MEMBERS) REGULATION 1983
ORDINARY RETURN-LEGISLATIVE COUNCIL/ASSEMBLY
DIRECTIONS:
(1) The pecuniary interests and other matters required to be disclosed in this return are prescribed by clauses 8-15 of the Constitution (Disclosures by Members) Regulation 1983.
(2) The particulars required to complete this form are to be written in block letters or typed.
(3) If any space is insufficient in this form for all the particulars required to complete it, attach an appendix for that purpose which is properly identified and signed by the Member.
(4) Where there are no pecuniary interests or other matters of the kind required to be disclosed under a particular main heading in this form, the word "NIL" is to be placed in an appropriate space under that heading.
DISCLOSURES OF PECUNIARY INTERESTS AND OTHER MATTERS BY ............................................................
.......................................................................................... IN RESPECT OF THE PERIOD FROM
(full name of Member)
................................................................................ TO .....................................................................
(ordinary return period)
............................................................ | |
(Member's signature) | |
............................................................ | |
(Date) |
A REAL PROPERTY
Address of each parcel of real property in which I had an interest at any time during the ordinary return period |
Nature of interest |
B SOURCES OF INCOME
1 Sources of income I received from an occupation at any time during the ordinary return period:
Description of occupation |
Name and address of employer or description of office held (if applicable) |
Name under which partnership conducted (if applicable) |
2 Sources of income I received from a trust at any time during the ordinary return period:
Name and address of settlor |
Name and address of trustee |
3 Sources of other income I received at any time during the ordinary return period:
(Include description sufficient to identify the person from whom, or the circumstances in which, that income was received.)
C GIFTS
Description of each gift I received at |
Name and address of donor |
D CONTRIBUTIONS TO TRAVEL
Name and address of each |
Dates on which |
Names of States, |
E INTERESTS AND POSITIONS IN CORPORATIONS
Name and address of |
Nature of |
Description of |
Description of |
F POSITIONS IN TRADE UNIONS AND PROFESSIONAL OR BUSINESS ASSOCIATIONS
Name of each trade union and each |
Description of position |
G DEBTS
Name and address of each person to whom I was liable to pay any debt at any time during the ordinary return period.
H DISPOSITIONS OF PROPERTY
1 Particulars of each disposition of real property by me at any time during the ordinary return period whereby I retained, either wholly or in part, the use and benefit of the property or the right to reacquire the property at a later time.
2 Particulars of each disposition of property to a person by any other person under arrangements made by me, being dispositions made at any time during the ordinary return period, whereby I obtained, either wholly or in part, the use and benefit of the property.
I DISCRETIONARY DISCLOSURES
APPENDIX F - CODE OF CONDUCT FOR MEMBERS OF THE BRITISH HOUSE OF COMMONS_
The Code of Conduct for Members of Parliament
Prepared pursuant to the resolution of the House of 19th July 1995
Purpose of the Code
The purpose of the Code of Conduct is to assist Members in the discharge of their obligations to the House, their constituents and the public at large.
The Code applies to Members in all aspects of their public life. It does not seek to regulate what Members do in their purely private and personal lives.
Public duty
By virtue of the oath, or affirmation, of allegiance taken by all Members when they are elected to the House, Members have a duty to be faithful and bear true allegiance to Her Majesty the Queen, her heirs and successors, according to law.
Members have a duty to uphold the law and to act on all occasions in accordance with the public trust placed in them.
Members have a general duty to act in the interests of the nation as a whole; and a special duty to their constituents.
Personal conduct
Members shall observe the general principles of conduct identified by the Committee on Standards in Public Life [1st report] as applying to holders of public office:-
"Selflessness Holders of public office should take decisions solely in terms of the public interest. They should not do so in order to gain financial or other material benefits for themselves, their family, or their friends |
Integrity Holders of public office should not place themselves under any financial or other obligation to outside individuals or organisations that might influence them in the performance of their official duties. |
Objectivity In carrying out public business, including make public appointments, awarding contracts, or recommending individuals for rewards and benefits, holders of public office should make choices on merit. |
Accountability Holders of public office are accountable for their decisions and actions to the public and must submit themselves to whatever scrutiny is appropriate to their office. |
Openness Holders of public office should be as open as possible about all the decisions and actions that they take. They should give reasons for their decisions and restrict information only when the wider public interest clearly demands. |
Honesty Holders of public office have a duty to declare any private interests relating to their public duties and to take steps to resolve any conflicts arising in a way that protects the public interest. |
Leadership Holders of public office should promote and support these principles by leadership and example." |
Members shall base their conduct on a consideration of the public interest, avoid conflict between personal interest and the public interest and resolve any conflict between the two, at once, and in favour of the public interest.
Members shall at all times conduct themselves in a manner which will tend to maintain and strengthen the public's trust and confidence in the integrity of Parliament and never undertake any action which would bring the House of Commons, or its Members generally, into disrepute.
The acceptance by a Member of a bribe to influence his or her conduct as a Member, including any fee, compensation or reward in connection with the promotion of, or opposition to, any Bill, Motion, or other matter submitted, or intended to be submitted to the House, or to any Committee of the House, is contrary to the law of Parliament.
Members shall fulfil conscientiously the requirements of the House in respect of the registration of interests in the Register of Members' Interests and shall always draw attention to any relevant interest in any proceeding of the House or its Committees, or in any communications with Ministers, Government Departments or Executive Agencies.
In any activities with, or on behalf of, an organisation with which a Member has a financial relationship, including activities which may not be a matter of public record such as informal meetings and functions, he or she must always bear in mind the need to be open and frank with Ministers, Members and officials.
No Member shall act as a paid advocate in any proceeding of the House.
No improper use shall be made of any payment or allowance made to Members for public purposes and the administrative rules which apply to such payments and allowances must be strictly observed.
Members must bear in mind that information which they receive in confidence in the course of their parliamentary duties should be used only in connection with those duties, and that such information must never be used for the purpose of financial gain.
APPENDIX G - STANDING ORDER 150, BRITISH HOUSE OF COMMONS - ESTABLISHMENT OF PARLIAMENTARY COMMISSIONER FOR STANDARDS
Note: This Standing Order has yet to be updated to reflect the resolutions of the House of Commons made on 26 June 2003 (see Appendix H).
150. - (1) There shall be an officer of this House, called the Parliamentary Commissioner for Standards, who shall be appointed by the House.
(2) The principal duties of the Commissioner shall be-
(a) to maintain the Register of Members' Interests and any other registers of interest established by the House, and to make such arrangements for the compilation, maintenance and accessibility of those registers as are approved by the Committee on Standards and Privileges or an appropriate subcommittee thereof;
(b) to provide advice confidentially to Members and other persons or bodies subject to registration on matters relating to the registration of individual interests;
(c) to advise the Committee on Standards and Privileges, its subcommittees and individual Members on the interpretation of any code of conduct to which the House has agreed and on questions of propriety;
(d) to monitor the operation of such code and registers, and to make recommendations thereon to the Committee on Standards and Privileges or an appropriate subcommittee thereof; and
(e) to receive and, if he thinks fit, investigate specific complaints from Members and from members of the public in respect of-
(i) the registration or declaration of interests, or
(ii) other aspects of the propriety of a Member's conduct, and to report to the Committee on Standards and Privileges or to an appropriate subcommittee thereof.
(3) The Commissioner may be dismissed by resolution of the House.
APPENDIX H - RESOLUTIONS OF THE BRITISH HOUSE OF COMMONS, 26 JUNE 2003.*
The Government believe that the Committee on Standards and Privileges and the Commission have recommended a sensible way forward and responded positively to the recommendations made by the Committee on Standards in Public Life. I ask the House to support the motion and the motions that follow.
Question put and agreed to.
Resolved,
That this House takes note of the Eighth Report of the Committee on Standards in Public Life (Cm. 5663), the Response to that Report by the House of Commons Commission (HC 422), and the Second Report of the Committee on Standards and Privileges (HC 403); and agrees with the recommendation in paragraph 50 of that Report that, in appropriate cases, the House should impose a penalty of withholding a Member's salary for a specified period without suspending the Member.
26 Jun 2003 : Column 1257
STANDARDS AND PRIVILEGES
Ordered,
That-
(1) Standing Order No. 149 (Committee on Standards and Privileges) be amended in line 39, after second `time', by inserting, `to appoint legal advisers'; and
(2) Standing Order No. 150 (Parliamentary Commissioner for Standards) be amended as follows:
(a) line 33, at end add `unless the provisions of paragraph (2A) apply.
(2A) No report shall be made by the Commissioner if, in any case where the Member concerned has agreed that he has failed to register or declare an interest, it is the Commissioner's opinion that the interest involved is minor, or the failure was inadvertent, and the Member concerned has taken such action by way of rectification as the Commissioner may have required within any procedure approved by the Committee for this purpose.
(2B) The Commissioner may at any time in the course of investigating a complaint, and if so requested by the Committee on Standards and Privileges shall, appoint an Investigatory Panel to assist him in establishing the facts relevant to the investigation.
(2C) An Investigatory Panel shall-
(a) consist of the Commissioner, who shall be Chairman of the Panel, and two assessors, one of whom shall be a legally qualified person appointed by the Commissioner and the other shall be a Member, who shall not be a member of the Committee on Standards and Privileges, appointed by the Speaker; and
(b) meet in private.
(2D) The Commissioner-
(a) shall determine the procedures of the Panel, subject to the provisions of this Order; and
(b) may appoint counsel for the purpose of assisting the Panel.
(2E) Any report that the Commissioner may have made to the Committee on Standards and Privileges in relation to the complaint before the appointment of the Panel shall be made available to the Panel by the Committee.
26 Jun 2003 : Column 1258
(2F) Any Member who is the subject of the complaint under investigation shall, if he so requests, be heard by the Panel; may call witnesses; and may examine other witnesses.
(2G) When the Panel has completed its proceedings-
(a) the Commissioner shall report as in paragraph (2)(e);
(b) the legal assessor shall report to the Committee on Standards and Privileges his opinion as to the extent to which its proceedings have been consistent with the principles of natural justice; and
(c) the Member assessor may report to the Committee on Standards and Privileges his opinion as to the extent to which its proceedings have had regard to the customs and practice of the House and its Members.
(2H) The Commissioner shall report each year to the House on the exercise by him of his functions.'.
(b) line 34, leave out paragraph (3) and add-
`(3) The Commissioner may be dismissed only following a resolution of the House, moved for by a Member of the House of Commons Commission, after the Committee on Standards and Privileges has reported to the House that it is satisfied that the Commissioner is unfit to hold his office or unable to carry out his functions; and any such report shall include a statement of the Committee's reasons for its conclusion.'-[Mr. Woolas.]
PARLIAMENTARY COMMISSIONER FOR STANDARDS
Resolved,
That this House agrees with the proposals of the House of Commons Commission in paragraphs 8 to 10 of its response to the Eighth Report from the Committee on Standards in Public Life (HC 422), that-
(a) any future appointment to the office of Parliamentary Commissioner for Standards shall be for a period of five years, and shall not be renewable; and
(b) notwithstanding the Resolution of the House of 13th February 2002, the appointment of the current Commissioner shall expire on 25th June 2008, and shall not be renewable.-[Mr. Woolas.]
APPENDIX I - STANDING ORDER 149, BRITISH HOUSE OF COMMONS - ESTABLISHMENT OF THE SELECT COMMITTEE ON STANDARDS AND PRIVILEGES
Note: This Standing Order has yet to be updated to reflect the resolutions of the House of Commons made on 26 June 2003 (see Appendix H).
149. - (1) There shall be a select committee, called the Committee on Standards
and Privileges-
(a) to consider specific matters relating to privileges referred to it by the House;
(b) to oversee the work of the Parliamentary Commissioner for Standards; to examine the arrangements proposed by the Commissioner for the compilation, maintenance and accessibility of the Register of Members' Interests and any other registers of interest established by the House; to review from time to time the form and content of those registers; and to consider any specific complaints made in relation to the registering or declaring of interests referred to it by the Commissioner; and
(c) to consider any matter relating to the conduct of Members, including specific complaints in relation to alleged breaches in any code of conduct to which the House has agreed and which have been drawn to the committee's attention by the Commissioner; and to recommend any modifications to such code of conduct as may from time to time appear to be necessary.
(2) The committee shall consist of eleven Members, of whom five shall be a quorum.
(3) Unless the House otherwise orders, each Member nominated to the committee shall continue to be a Member of it for the remainder of the Parliament.
(4) The committee shall have power to appoint subcommittees consisting of no more than seven Members, of whom three shall be a quorum, and to refer to such subcommittees any of the matters referred to the committee; and shall appoint one such subcommittee to receive reports from the Commissioner relating to investigations into specific complaints.
(5) The committee and any subcommittee shall have power to send for persons, papers and records, to sit notwithstanding any adjournment of the House, to adjourn from place to place, to report from time to time and to appoint specialist advisers either to supply information which is not readily available or to elucidate matters of complexity within the committee's order of reference.
(6) The committee shall have power to order the attendance of any Member before the committee or any subcommittee and to require that specific documents or records in the possession of a Member relating to its inquiries, or to the inquiries of a subcommittee or of the Commissioner, be laid before the committee or any subcommittee.
(7) The committee, or any subcommittee, shall have power to refer to unreported evidence of former Committees of Privileges or of former Select Committees on Members' Interests and to any documents circulated to any such committee.
(8) The committee shall have power to refuse to allow proceedings to which strangers are admitted to be broadcast.
(9) Mr Attorney General, the Advocate General and Mr Solicitor General, being Members of the House, may attend the committee or any subcommittee, may take part in deliberations, may receive committee or subcommittee papers and may give such other assistance to the committee or subcommittee as may be appropriate, but shall not vote or make any motion or move any amendment or be counted in the quorum.
APPENDIX J - COMPLAINTS HANDLING PROCESS IN THE BRITISH HOUSE OF COMMONS
APPENDIX K - SECTION 39 OF THE SCOTLAND ACT 1998 (MEMBERS' INTERESTS)
Members' interests. 39. - (1) Provision shall be made for a register of interests of members of the Parliament and for the register to be published and made available for public inspection.
(2) Provision shall be made-
(a) requiring members of the Parliament to register in that register financial interests (including benefits in kind), as defined for the purposes of this paragraph,
(b) requiring that any Member of the Parliament who has a financial interest (including benefits in kind), as defined for the purposes of this paragraph, in any matter declares that interest before taking part in any proceedings of the Parliament relating to that matter.
(3) Provision made in pursuance of subsection (2) shall include any provision which the Parliament considers appropriate for preventing or restricting the participation in proceedings of the Parliament of a Member with an interest defined for the purposes of subsection (2)(a) or (b) in a matter to which the proceedings relate.
(4) Provision shall be made prohibiting a Member of the Parliament from-
(a) advocating or initiating any cause or matter on behalf of any person, by any means specified in the provision, in consideration of any payment or benefit in kind of a description so specified, or
(b) urging, in consideration of any such payment or benefit in kind, any other Member of the Parliament to advocate or initiate any cause or matter on behalf of any person by any such means.
(5) Provision made in pursuance of subsections (2) to (4) shall include any provision which the Parliament considers appropriate for excluding from proceedings of the Parliament any Member who fails to comply with, or contravenes, any provision made in pursuance of those subsections.
(6) Any Member of the Parliament who-
(a) takes part in any proceedings of the Parliament without having complied with, or in contravention of, any provision made in pursuance of subsection (2) or (3), or
(b) contravenes any provision made in pursuance of subsection (4),
is guilty of an offence.
(7) A person guilty of an offence under subsection (6) is liable on summary conviction to a fine not exceeding level 5 on the standard scale.
(8) In this section-
(a) "provision" means provision made by or under an Act of the Scottish Parliament,
(b) references to members of the Parliament include references to the Lord Advocate and the Solicitor General for Scotland, whether or not they are such members.