2.1
This chapter considers key issues arising from the committee’s consideration of the Annual Report of the Integrity Commissioner 2020-21 (Annual Report 2020-21), including:
the expansion of the Integrity Commissioner’s jurisdiction on 1 January 2021 and the impact on the Australian Commission for Law Enforcement Integrity (ACLEI);
ACLEI’s new performance framework;
the definition of corruption under the Law Enforcement Integrity Commissioner Act 2006 (LEIC Act);
dealing with evidence of an offence and the requirements on the Integrity Commissioner; and
the acting arrangements when the Integrity Commissioner is unavailable and the proposal to establish a Deputy Integrity Commissioner position within ACLEI’s organisational structure.
Jurisdictional expansion
2.2
In 2020-21, ACLEI’s jurisdiction expanded in accordance with the first phase of the government’s plan to establish the Commonwealth Integrity Commission (CIC).
2.3
As mentioned in Chapter 1, for the entirety of 2020-21, the Integrity Commissioner’s jurisdiction covered the following law enforcement agencies:
the Australian Criminal Intelligence Commission (ACIC);
the Australian Federal Police (AFP) (including ACT Policing);
the Australian Transaction Reports and Analysis Centre (AUSTRAC);
prescribed aspects of the Department of Agriculture, Water and Environment (DAWE); and
the Department of Home Affairs (Home Affairs), including the Australian Border Force.
2.4
On 1 January 2021, the Integrity Commissioner’s jurisdiction expanded pursuant to amendments of the LEIC Regulations to include the following agencies (referred to hereafter as ‘the expansion agencies’):
the Australian Competition and Consumer Commission (ACCC);
the Australian Prudential Regulation Authority (APRA);
the Australian Securities and Investments Commission (ASIC); and
the Australian Taxation Office (ATO).
2.5
Pursuant to section 6(2) of the LEIC Act, to fall within ACLEI’s jurisdiction, a staff member from one of the above four expansion agencies would need to engage in corrupt conduct related to a law enforcement function of the agency (see ‘Limb test’ below). This is to ensure that ACLEI’s jurisdiction is linked to only the law enforcement aspect of these agencies.
Limb test
2.6
An allegation of corruption will be captured under the Integrity Commissioner’s jurisdiction if it is a ‘corruption issue’. For the AFP, Home Affairs, ACIC, AUSTRAC and prescribed aspects of DAWE, the LEIC Act provides a two-limb test that must be satisfied for an allegation to be a corruption issue:
Is the allegation about a person who is or was a staff member of a law enforcement agency?
Is the allegation that the person, while a staff member, engaged, may be engaged or will engage in corrupt conduct?
2.7
In the case that an allegation relates to the ACCC, APRA, ASIC or the ATO, an additional limb must also be satisfied:
Does the alleged conduct relate to the performance of a law enforcement function?
2.8
Although not explored as part of the committee’s examination of the Annual Report 2020-21, the committee is aware that there are challenges in applying the law enforcement function test. This was raised by both ACLEI and expansion agencies as part of the committee’s inquiry into the expansion of ACLEI’s jurisdiction and the corruption vulnerabilities in Australia’s law enforcement agencies’ contracted services (hereafter the ‘expansion of jurisdiction and corruption vulnerabilities inquiry’). However, the Integrity Commissioner, Ms Jaala Hinchcliffe, advised that ‘although there is still some uncertainty in relation to how that test will apply in every case, [the expansion agencies] said they have felt supported in that process’.
Engagement with the expansion agencies
2.9
During the public hearing, the Integrity Commissioner advised that, despite the impact of the COVID-19 pandemic, ACLEI met its increased operational demands while managing the jurisdictional expansion and engagement with the expansion agencies.
2.10
ACLEI explained that it began working with the expansion agencies before they were subject to ACLEI’s jurisdiction to ensure that the agencies understood their obligations under the LEIC Act and Regulations as well as ACLEI’s role. Through close engagement with the expansion agencies, ACLEI noted it built its understanding of each agency’s functions to assist with assessing whether notifications and referrals fall within ACLEI’s jurisdiction.
2.11
At the public hearing, the Integrity Commissioner highlighted the willingness of the expansion agencies to engage with ACLEI to understand, and ensure they could comply with, their legislative requirements.
2.12
In a public hearing for the committee’s expansion of jurisdiction and corruption vulnerabilities inquiry, the expansion agencies themselves highlighted ACLEI’s high levels of engagement. The committee heard that ACLEI and the expansion agencies share a productive working relationship and work collaboratively to respond to allegations of corruption. The expansion agencies reported that they regularly meet with ACLEI at various departmental levels, including with agency heads and investigators. They also highlighted the benefits of participating in ACLEI’s Community of Practice for Corruption Prevention.
Corruption allegations
2.13
During the 2020-21 reporting year, ACLEI received 12 matters in total from the expansion agencies (including notifications, referrals and own-initiative matters). ACLEI stated this number ‘was lower than anticipated’ and may reflect the nature of ACLEI’s jurisdiction over the expansion agencies, which is limited by the application of the third part of the abovementioned ‘limb test’.
2.14
During the committee’s public hearing with expansion agencies and ACLEI for the expansion of jurisdiction and corruption vulnerabilities inquiry, the Integrity Commissioner advised that in the current reporting year (2021-22), ACLEI has so far received 21 matters from the expansion agencies (this number may, of course, have increased since the public hearing). Ms Hinchcliffe stated that although this is a small increase in matters, she expects ACLEI ‘will continue to see a slight increase in those matters going forward’. Furthermore, the Integrity Commissioner suggested that the expansion agencies are taking a cautious approach when notifying allegations of corrupt conduct since several matters referred to ACLEI have been assessed as outside its jurisdiction. Ms Hinchcliffe noted that ACLEI would continue to work with agencies regarding the application of the law enforcement test.
Additional resources
2.15
As part of the 2020-21 Budget (released in October 2020), ACLEI was provided with an additional $10 million and an increase to its staff profile to assist with the jurisdictional expansion and to prepare for the CIC.
2.16
During 2020-21, ACLEI undertook 23 recruitment processes, which is a significant endeavour for a small agency. As part of ACLEI’s recruitment drive, the agency recruited two Executive Directors to lead ACLEI’s two Operations Branches and recruited new staff members to all agency areas, including corporate services and operation teams.
2.17
At the end of the 2019-20 reporting period, ACLEI had a headcount of 54 staff members. By 30 June 2021, ACLEI’s headcount increased to 74 staff members. At the public hearing, the Integrity Commissioner noted the growth of the agency, stating ‘we have gone from being an agency of about 40 staff to now an agency of nearly 100’. ACLEI stated it would continue to recruit investigators, intelligence analysts and lawyers into the 2021-22 reporting year.
Committee comment
2.18
The committee notes ACLEI’s diligent work in onboarding the expansion agencies while operating at an increased operational tempo. The committee is pleased that ACLEI and the expansion agencies have established productive working relationships. The committee understands that ACLEI and the expansion agencies are working closely to apply the law enforcement function test to ensure notifications are referred appropriately.
2.19
The committee will continue to examine ACLEI’s work with the expansion agencies and the complexity of the law enforcement function test as part of its ongoing expansion of jurisdiction and corruption vulnerabilities inquiry.
New performance framework
2.20
In 2019-20, ACLEI revised its performance framework and measures to ensure that they assist ACLEI to manage its workload, and that activities are undertaken in a ‘timely and rigorous way’ as required under the LEIC Act.
2.21
At the public hearing, the Integrity Commissioner, summarised the process of redeveloping the performance framework. To ensure ACLEI’s ability to effectively measure and benchmark its performance, it:
considered the recommendations from the Australian National Audit Office’s performance report from 2018;
examined the performance measures used by other oversight agencies and anti-corruption bodies; and
carefully reflected on ACLEI’s prescribed role and functions and developed four key activities, as set out in the next section of this chapter.
Key activities and performance measures
2.22
ACLEI’s four key activities include:
Assessments—ACLEI receives and assesses notifications and referrals of alleged corrupt conduct by:
providing clear reporting channels for agencies and members of the public;
assessing reports of alleged corrupt conduct in a timely fashion; and
dealing with reports of alleged corrupt conduct in the most appropriate manner.
ACLEI investigations—ACLEI conducts investigations into serious and systemic corrupt conduct through:
using its expertise as investigators to fully investigate referrals and notifications of alleged corrupt conduct;
effectively and efficiently analysing intelligence from a range of sources to further its investigations;
ensuring investigations are completed in a timely fashion;
working jointly with other law enforcement agencies where appropriate; and
acting within the bounds of [its] jurisdiction.
Supporting partner agency investigations—ACLEI supports its partner law enforcement agencies to conduct their own investigations through:
the use of its powers to oversee and manage agency investigations under the LEIC Act, where appropriate;
reviewing the progress of agency investigations; and
providing feedback and advice on agencies’ final reports on their investigations.
Prevention—ACLEI prevents corruption through:
identifying and disseminating information on corruption vulnerabilities and risks to partner agencies and the public;
providing tailored assistance to Australian Government law enforcement agencies to detect corrupt conduct and mitigate risks;
specialist projects on emerging corruption threats and innovative approaches to prevention; and
engaging with the Australian Parliament, agencies and the public.
2.23
ACLEI’s performance measures align with its four key activities ‘to create a direct line between [its] purpose, activities and performance’. The Integrity Commissioner reiterated this point at the public hearing and emphasised the importance the measures have in assisting the agency to focus on completing its work in a timely manner, thereby helping to avoid a backlog of uncompleted investigations (a problem that has previously occurred, and that ACLEI has made significant progress in resolving in recent years).
2.24
ACLEI noted that in the past, it had focused on reporting against qualitative measures, but its framework now includes numerous quantitative measures to assist performance assessment.
2.25
ACLEI reported against its new performance framework for the first time in 2020-21. ACLEI’s performance framework, and its performance against it, is discussed in further detail in Chapter 3.
A potential fifth key activity
2.26
The Integrity Commissioner told the committee that there is likely a fifth activity ACLEI undertakes and might in future be reflected in the performance framework, that is, detection. Ms Hinchcliffe explained that the agency had performed some detection work, such as detecting corrupt conduct through its investigative work and conducting environmental scans. However, ACLEI is considering how it can ‘better fulfil [the] function of detecting corrupt conduct’ with its current resources. For example, ACLEI’s recently established Strategic Intelligence and Data Analysis team is expected to undertake some detection work with other internal areas to identify corruption themes and hotspots within ACLEI’s jurisdictional agencies.
2.27
In addition, Mr Peter Ratcliffe, Executive Director, Operations Southern, added that the detection function the agency undertakes would be performed collaboratively with its jurisdictional agencies and, hopefully, with other similar bodies such as state and territory anti-corruption agencies.
Looking ahead
2.28
The Integrity Commissioner further advised the committee that ACLEI will keep the performance measures ‘under review’ to ensure it has the right measures in place to provide ‘a more nuanced explanation of [ACLEI’s] performance story’.
2.29
Furthermore, she indicated that ACLEI is considering how its performance measures, and the statistics it is required to include in its annual report, can ‘sit together to tell a really clear story’ about the work of the agency. This is likely to be explored in the 2021-22 reporting year.
Committee comment
2.30
The committee welcomes ACLEI’s new performance framework and acknowledges ACLEI’s considerable effort to revise it. The committee notes that the framework now includes a combination of qualitative and quantitative measures to assess ACLEI’s performance.
2.31
The committee appreciates that ACLEI plans to continue refining its framework and metrics as its data analysis matures. The committee looks forward to further discussions with ACLEI regarding its performance measures and changes made to improve the framework to better reflect the agency’s functions and work.
Definition of ‘corruption’
2.32
At the public hearing, the Integrity Commissioner was asked to reflect on whether the definition of corruption under the LEIC Act is appropriate or needs review. In reply, the Integrity Commissioner noted that the definition for a corruption issue is quite broad, particularly in how it relates to engaging in corrupt conduct. She explained that during the last two years, ACLEI carefully considered what is encompassed under corrupt conduct and whether it is appropriate for all matters to stay within ACLEI’s framework, pointing out that some matters can be managed through agency code of conduct procedures. For example, the Integrity Commissioner stated:
…allegations of browsing [of protected systems] fall within the definition of 'corruption of any other kind'. Allegations of browsing of systems are quite minor and are properly dealt with by agencies through their code of conduct or through warning letters. In my view, they don't need to stay within a regimented framework like the LEIC Act.
2.33
Additionally, Ms Judith Lind, Executive Director, Operations Northern, advised that ACLEI recently published an assessment policy, which covers the factors that are considered when assessing an allegation of corrupt conduct, to provide ‘greater transparency’ as to how matters are dealt with. ACLEI plans to engage with its agencies in the coming months to discuss the policy in detail.
Committee comment
2.34
The committee notes the Integrity Commissioner’s view on the definition of ‘corruption’ under the LEIC Act.
2.35
The committee will continue to consider whether the abovementioned definitions are appropriate for the breadth and scope of ACLEI’s work.
Dealing with evidence of an offence
2.36
During the public hearing, the Integrity Commissioner was questioned about the application of section 142 of the LEIC Act. The Integrity Commissioner explained that under section 142, she must assemble and provide evidence to the AFP, or the Commonwealth Director of Public Prosecutions (CDPP) if, in the course of investigating a corruption issue or conducting a public inquiry, evidence is obtained of an offence against a law of the Commonwealth that would be admissible in a prosecution for the offence.
2.37
The Integrity Commissioner emphasised she cannot exercise discretion to not provide a brief of evidence when admissible evidence is obtained, as it is mandated in the LEIC Act that she provides it. This is in contrast to other investigative agencies who can exercise such discretion.
2.38
Furthermore, the Integrity Commissioner advised that referring a trivial offence that she would otherwise not refer can have ‘unintended consequences’, including impacts on ACLEI’s and the CDPP’s resources.
2.39
In addition, the Integrity Commissioner pointed out that ACLEI aligns and operates in the same way as other Commonwealth law enforcement agencies apart from section 142.
Committee comment
2.40
The committee was interested to hear the Integrity Commissioner’s perspective on applying section 142 of the LEIC Act and is concerned by the evidence raised that section 142 does not provide the Integrity Commissioner with discretion as to whether to refer a brief of evidence to the AFP or CDPP. Therefore, the committee encourages the government to consider if current settings are appropriate, particularly in light of the unintended consequences referred to by the Integrity Commissioner.
Deputy Integrity Commissioner
2.41
At the public hearing, the Integrity Commissioner was asked about the acting arrangements that apply when she is unavailable, as ACLEI’s organisational structure does not include a Deputy Integrity Commissioner. In response,
Ms Hinchcliffe explained that at present, one of the following three officials from other Commonwealth integrity agencies can act for the Integrity Commissioner when he or she is absent for five days or more: the Deputy of the Inspector-General of Intelligence and Security, the Deputy of the Office of the Commonwealth Ombudsman, and the Deputy of the Office of the Information Commissioner.
2.42
The Integrity Commissioner informed the committee that due to ACLEI’s recent growth in size and jurisdiction consideration needs to be given to establishing a Deputy Integrity Commissioner position for the ‘ongoing sustainability’ of ACLEI and that ACLEI is currently in discussions with the government about the issue.
Committee comment
2.43
The committee is supportive of the need to establish a Deputy Integrity Commissioner within ACLEI’s organisational structure. Further, consideration should be given to whether the current acting arrangements for the Integrity Commissioner are fit-for-purpose due to ACLEI’s recent expansion of jurisdiction and if a Deputy Integrity Commissioner would be a more appropriate arrangement for the agency long-term.
2.44
The committee considers it is more suitable to have a Deputy Integrity Commissioner acting in the Integrity Commissioner’s absence rather than external stakeholders.
2.45
The committee also acknowledges that while the Governor-General can appoint an Assistant Integrity Commissioner under section 185 of the LEIC Act, a statutory official may not be required given the size of ACLEI and its workload.
2.46
The committee recommends that for the ongoing sustainability of the Australian Commission for Law Enforcement Integrity and the recent expansion of its jurisdiction and workforce, the Australian Government give favourable consideration to the proposal by the Integrity Commissioner to create a Deputy Integrity Commissioner position within the agency.