CHAPTER 1: BACKGROUND TO THE INQUIRY

CHAPTER 1: BACKGROUND TO THE INQUIRY

Decision to Commence the Present Evaluation

1.1              In mid-1990, the Committee decided to make a comprehen­sive evaluation of the AuthorityIts decision was based on a number of factors:

  • The Committee has a statutory duty ‘to monitor and to review’ the Authority and to report its findings to the Parliament[1]

  • The Initial Evaluation report, tabled in May 1988 by the Committee's predecessor, recommended that a comprehensive evaluation should be conducted seven years from the establishment of the Authority[2] This recommendation was not opposed by the Government[3]

  • There were major concerns about the Authority's management, strategic direction and operations, including the concerns which had led to the Arthur Anderson report[4]

  •  The NCA Act contained a provision that the Authority would cease to exist at the end of June 1989This ‘sunset’ provision was repealed in June 1988[5] The repeal did not, however, involve any public assessment of the continued need for the Authority or of the provisions of the NCA Act[6]

  • A significant body of information has become available over the past few years.

Conduct of the Evaluation

1.2              In July 1990, the Committee placed advertisements in the following newspapers calling for written submissions: the Adelaide Advertiser, Melbourne Age, Australian, Australian Financial Review, Canberra Times, and Sydney Morning HeraldThe Committee also wrote to interested parties and invited them to make submissions or meet with the Committee.

1.3              The Committee requested that written submissions address the following issues:

           (1) the constitution, role, functions and powers of the authority, and the need for a body such as the Authority, having regard to the activities of other Commonwealth and State law enforcement agencies;

           (2) the efficiency and effectiveness of the Authority;

           (3) accountability and parliamentary supervision of the Authority; and,

           (4) the need for amendment of the National Crime Authority Act 1984.

The Committee received 56 submissionsThe persons and organisations who made submissions are listed in Appendix 3.

1.4              Between November 1990 and October 1991, the Committee held a total of 12 public hearings in Adelaide, Brisbane, Canberra, Hobart, Melbourne and SydneyA total of 64 individuals appeared to give evidence at these hearingsAll were held in public with the exception of two short periods at the first hearingThose who appeared are listed in Appendix 4.

1.5              The public hearing with the Authority held in Canberra on 29 July 1991 was the first occasion since its creation that the Authority has appeared before the Committee to give evidence in publicThe hearing provided an increased opportunity for the Authority to respond in public to questions about its performance

1.6              In addition to submissions and the evidence given at the hearings, the Committee has been able to draw on information provided by the Authority at the regular briefings it gives the CommitteeThe Authority responded in writing in July and August 1991 to questions from the CommitteeThe Committee also had discussions between June and September 1990 with:

         the Commissioner, the Secretary and the Director of Operations of the Independent Commission Against Corruption;

  • the Director of the Cash Transaction Reports Agency;

  • the Commissioner of the Australian Federal Police;

  • officers from the Australian Taxation Office;

  • the Chief Commissioner of the Victoria Police; and

  • the Acting Commissioner and senior officers of the South Australia Police Department

Changes at the Authority - Effect on the Evaluation

1.7              Since the Committee began its evaluation, important changes have occurred involving the Authority These include:

the appointment of a new Chairman, the HonJustice John HPhillips from the Victorian Supreme Court, on 14 August 1990;[7]

  • the preparation by Justice Phillips of Chairman's Proposals for Future Directions: A Submission to the Inter-Governmental Committee, 15 November 1990, which proposed a major reorientation in the direction and form of the Authority's work;[8]

  • the endorsement of Future Directions on 23 November 1990 by the Inter-Governmental Committee of Commonwealth, State and Territory Ministers who monitor the work of the Authority;[9]

  • the opening of newly-established Authority offices in Perth on 1 August 1991 and Adelaide on 2 August 1991;[10] and 

  •  the publication on 1 August 1991 of the Authority's Corporate Plan July 1991-June 1994, which represented the culmination of a process that began with the Arthur Andersen report.

1.8              On 21 September 1990, the HonMichael Duffy MP, the Attorney-General and Chairman of the IGC, replied to the Committee's invitation to make a submission[11] He told theCommittee that the request for submissions had been discussed by the IGC at its meeting in Melbourne on 31 August:

The IGC unanimously held the view that, in light of the very recent appointment of the Hon Mr Justice J H Phillips as Chairman of the NCA, it is most inapprop­riate for the PJC to be undertaking a review at this timeThe IGC also agreed that neither the IGC members nor their respective agencies would be providing individual submissions to the PJC reviewIt was decided that the IGC would put in a joint submission after the November IGC meeting, which would reflect the IGC's consider­ation of the NCA Chairman's November report.

1.9              The Governments represented on the IGC did not make submissionsState and Federal agencies, however, did provide submissions and appeared before the Committee at hearings[12]

1.10           The IGC's submission, dated April 1991, noted the IGC's August 1990 view that the timing of the Committee's evaluation was inappropriate:

All members of the IGC still are of this view, and particularly now that the new Chairman of the NCA has announced plans for the future directions of the Authority which constitute significant adjustments of former arrangements and strategiesConducting a ‘root and branch’ review prior to the implemen­tation of these plans would seem to be of academic, historical interest only, and carries with it the real risk that the PJC's evaluation will therefore be based on irrelevant, dated materialA flawed evalua­tion is most likely to adversely affect the effect­iveness of the NCA and wider law enforce­ment efforts[13]

1.11           The Committee rejected the IGC's view, which conflicted with the Committee's statutory dutyThe Committee recognised that there is no ideal time to exercise this duty, as changes will always be occurring at the Authority[14] Moreover, as the Authority noted: ‘it is in some respects essential to consider the past effectiveness and efficiency of an agency when considering its future role and activity’[15]

1.12           Over half the submissions were received and one hearing was held before Future Directions, and the IGC's approval of it, were made publicNot all subsequent submissions and witnesses took Future Directions into considerationThe Committee recognised the need to take this into account in relying on the evidence it received.

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