Open Submission Select Senate Committee Sports Grant Administration Madeleine Kingston Private Stakeholder 21 February 2020

Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

1 Covering Letter Submission 21 February 2019 Committee Secretary Department of the Senate Select Committee on Administration of Sports Grants PO Box 6100 Parliament House Canberra ACT 2600 By mail [email protected] Dear Select Senate Committee Members Re Select Committee on Administration of Sports Grants I address the Committee with a submission on some of the terms of reference criteria and under Other Matters raise others for consideration as invited to do so. This matter is of wide continuing public interest and highlights compromised accountability and transparency. The implications of the sports grants saga continues to represent widespread concerns about the integrity of the system and this is a sobering reminder that standards need urgently to be lifted and greater accountability and transparency delivered. Other grant administration schemes may also be impacted, with the potential for the same mistakes and approaches to be demonstrated. It is time for an Integrity Commission with teeth. Many in the community would support this and I believe also many parliamentarians. There is a Bill on foot as part of a clutch of measures in this regard which I strongly support and will provide insights to the Senate on that matter. Besides the necessity to find out exactly what went wrong and why with the pre- election sports grants administration in respect of two separate schemes, only one of which was associated with Sports Australia as the badge name for the Australian Sports Commission established under the Australian Sports Commission Act 1989. That matter became the subject of a 10-month audit by the Australian National Office of Audit under the direction of the Auditor-General, Grant Hehir, and in which several key ANOA staff were involved including the Executive Director of ANOA, Brian Boyd. Both Mr Hehir and Mr Boyd appeared before the Select Senate Committee Members at a public hearing on Friday 14 February and had an opportunity to clarify the comprehensive report that ANOA presented to Parliament, especially in relation to misconceptions that all grant allocations made were to eligible applications, which is far from the case. My submission addresses the main criteria provided as the key foci of the Terms of Reference and adds to this in particular with regard to the proper interpretation of legal authority and ministerial discretion which terms appear to have been taken out of the context of their legal meaning. I argue with substantiation that these matters were central to considering the extent to which ministerial intervention should have occurred at all given the inter-related considerations that need to be given to the nuances of interpretation under multiple statutes including the Constitution, which says nothing at all about sports grant administration.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

My substantiating material relies heavily on the ANOA Report, perusal of the five submissions that have been received and published so far, and multiple media reports over the last several months that have added to public understanding of the matter, raising concerns about governance and public accountability and transparency that need to be addressed. The implications of this matter and the many misconceptions that have arisen as to ministerial jurisdictional boundaries, perceived political bias in the handling of this matter prior to the 2019 election and perceived distortion and misapplication of existing procedures for grant assessment and cash allocations for eligible parties. There are clearly many matters of material divergence between the limited scope summary prepared by the Secretary to the Department of Cabinet upon the Prime Minister’s request on 17 January, resulting in a more comprehensive report which has been deemed to be a secret and privileged document apparently prepared for Cabinet consideration. It is regrettable and disappoint to the public at large that this position has been taken, but at least we have some perspectives provided by the DPMC though its Secretary Phil Gaetjens, which I have read. I have also studied the lengthy and well-presented report prepared by the Australian National Office of Audit a highly respected statutory authority with wide powers of investigation which had far more time to investigate this matter than did DPMC staff. I place great realiance on the ANOA Report of 15 January 2020 and on credible media reports from senior political reporters including the Political Editor of the ABC. I provided citations from such sources and commentary and have also provided an expert professorial legal academic opinion with direct quotes and citations to a publicly available article and video interview on this topic with a focus on legal authority and discretion with possibly associated unlawfulness. These matters are so much broader than whether or not a particular minister declared her membership of two sporting clubs that received grants, seen as the sole breach of standards. I understand that reliance has been placed on the Statement of Ministerial Responsibility as if it were a mandated code of conduct with clout. It is simply a statement and has its many limitations. I have suggested that it be replaced with mandated Codes of Conduct with clout and associated penalty clauses and that the terms “considerable privilege” and “wide discretion” be removed from it altogether whilst it is still in use. These terms seem to be an invitation to parliamentarians to do anything they wish whenever they wish, but they have particular legal meanings and should be spariningly used. I have included my standard disclaimer document following the covering letter and an automated contents page. I would be happy to clarify any matter and to provide further commentary and citations. I appreciate the opportunity to participate in this public consultation. Finally I apologise for the length of this this submission. I hope it will give the Committee food for thought. Sincerely

Madeleine Kingston Concerned Victorian Voter and Private Stakeholder

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

2 DISCLAIMERS This material, including all appendices have been prepared as a public document to inform Senate Committees, Senate Select Committees parliamentarians policy-advisers policy-makers, regulators, incorporated entities with a statutory role and the general public and hopefully to stimulate debate and discussion about reforms in a climate consumer trust and confidence in the political system issues are being re-examined. Its central aim is to provide a selection of collated views of stakeholders. The material has been prepared in honesty and in good faith, expressing frank opinion and perceptions without malice about perceived systemic regulatory deficiencies and shortfalls, market conduct and often poor stakeholder consultative processes, with disclaimers about any inadvertent factual or other inaccuracies. Perhaps I should go a step further and take a leaf from the wording of disclaimers adopted by CRA in their various reports1 and add that “I shall have and accept no liability for any statements opinions information or matters (expressed or implied) arising out of contained in or derived from this document and its companion submissions and appendices) or any omissions from this document or any other written or oral communication transmitted or made available to any other party in relation to the subject matter of this document.” Every endeavour has been made to acknowledge as accurately as I can the numerous citations included from material accessible from the public domain. As to perceptions and opinions expressed by a private citizen, and those referred to from public domain documents, these too are expressed in honesty, good faith and without malice or vexatious intent, but reflect genuine concerns about policy and regulatory provision and complaints and redress mechanisms. The time is right now for this clutch of Bills to be pursued with the aspiration goal at least of attempting to restore some measure of consumer trust and confidence in the political system. Feel free to invite me directly to participate in future initiatives like this, which I will aid to participate in if time permits.

Madeleine Kingston, Private Stakeholder

1 See for example the CRA commissioned Report to the AEMC’s Review of the effectiveness of competition in the gas and electricity retail markets in Victoria 2008. This report was analysed in my 2007 2-part submission to the AEMCs Victorian review of retail energy competition Page 4 of 55

Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

CONTENTS

1 COVERING LETTER SUBMISSION ...... 2

2 DISCLAIMERS ...... 4

3 MANAGEMENT AND ASSESSMENT PROCESS ...... 6

4 ADHERENCE TO PUBLISHED ASSESSMENT PROCESSES AND PROGRAM CRITERIA ...... 10

5 THE ROLE OF THE OFFICES OF THE MINISTER, THE PRIME MINISTER AND DEPUTY PRIME MINISTER AND ANY EXTERNAL PARTIES IN DETERRING GRANT AWARDS ...... 16

6 OTHER RELEVANT MATTERS ...... 22 6.1 LEGAL AUTHORITY AND UNFETTERED DISCRETION AND PERCEPTIONS OF UNLAWFULNESS ...... 23 6.1.1 Views of ANOA on absence of evidence of legal authority for Sports Minister to intervene ...... 39 6.1.2 Views of Professor of Constitutional Law, Professor Anne Twomey, University of Sydney on legal authority discretion and unlawfulness ...... 40

8 LIMITED ANNOTATED LIST OF LEGISLATIVE AND OTHER PROVISIONS RELIED UPON ...... 44

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

3 Management and Assessment Process 1. The ANO report included these key points:

• A single application round was run from August to September 2018 with 2056 applications received seeking grant funding totalling $397 million.

• Sport Australia assessed the applications against the published assessment criteria. The Minister's Office conducted a parallel assessment process using other considerations.

• 684 grants totalling $100 million were awarded by the Minister for Sport in three rounds (in December 2018, February 2019 and April 2019).

74/100 would have been the cut off score if funding had been awarded based on Sport Australia's assessed merit

417 applications (61 per cent of total approved) with a score below this cut off were approved for funding.

1. The Community Sport Infrastructure Grant Program (CSIG/the program) was established in 2018 to ensure more Australians have access to quality sporting facilities, encouraging greater community participation in sport and physical activity. 2. The program is administered by the Australian Sports Commission (Sport Australia). The published program guidelines outlined that all eligible applications would be assessed against the three weighted merit criteria, with funding to be awarded on a competitive basis by the Minister for Sport. The guidelines further set out that funding announcements were expected from 1 November 2018 onwards and that projects were expected to be completed by 30 June 2019. 3. Applications opened on 2 August 2018 and closed on 14 September 2018. Sport Australia received 2056 project proposals seeking more than $396.6 million in Australian Government funding. Funding totalling $100 million was awarded to 684 projects across three rounds completed in December 2018, February 2019 and April 2019. 2. The ANOA Report confirmed that the assessments of applications were conducted in three rounds: The figures below isolate only those with top scores above the cut- off point of 74

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

2.1. 137 applications in the first round, scoring between 83 and 98; 3. 151 applications in the second round, scoring between 78 and 83; and 4. 165 applications in the third round, scoring between 74 and 78. 5. The cut-off point for merits weighted scoring was 74 to move from eligibility to apply to comparative merit in staying in the assessment process. As shown above, many worthy applications scored well above the required minimum Score. 6. The one’s with the highest score were set aside as the most worthy. 7. By contrast the Minister who ran a parallel assessment scheme bas on location to marginal seats only which was not a criteria in the Sports Australia nuanced merits assessments criteria had some successful applicants with scores well below the minimum required: as low as 50 points, which would have immediately disqualified an applicant under the Sports Australia. Though a proportion of electorates with Labor as the incumbent prior to the election were allocated sports grants, they were all marginal seats. This was not intended as a generous service to Labor, quite the opposite. Blind Freddy would be able to see that the intent was to wrench votes away from Labor, not to keep them entrenched in seats they held, that would not have been a logical election plan playing with money that had been allocated for a particular purpose with the intent of ensuring fair and equitable allocation of grants to those deemed most worthy on the basis of weight scoring. 8. The ANOA report noted the logistic difficulties in dealing with grant applications in staggered tranches. This meant that a true comparison could not be made in a comprehensive score process. The Minister had hijacked the applications and the process and was not transparent with the Sports authority about how scoring was conducted. The Attorney- General noted that the allocations were not made on public interest but rather as a political gain strategy using funds intended to be allocated to those in most need, not as a means of promoting the political interests of a party 9. On the issue of application design, applicants including those who have made submissions to this Committee have been complementary about this, found it easy to complete applications and appreciated the assistance provided by Sports Australia when queries arose. 10. I have sighted the five submissions that were made to this Committee within the week allowed for submissions to be made. I am satisfied from the feedback from applicants and sight of the application form that the process was easy to follow and respond to I quote from the application from the City of Bayswater Morely, WA: 10.1. “The program design and guidelines were clear and enabled Council to consider a number of different projects before finally submitting the application for the resurfacing of the Noranda Netball Courts, identified by the Council as a high priority due to the number of weekly users at the Page 7 of 55

Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

facility. The project has also been on the council’s works plans but has been delayed or deferred due to insufficient funding. 10.2. The City of Bayswater was certain that the guideline were satisfied and they would have been eligible for funding, but it seems that the entire process of assessment was hijacked by the Minister for Sport and her ministerial staff with a little help from the Prime Minister’s Office, as evidenced in the dozens of email communications discovered by the ANOA along with coloured spreadsheets identifying marginal seats and targeted allocations. 11. I note that the ANOA Report findings that the processes and procedures in place, that the assessment score clearly indicated the extent to which the Sport Australia assessment team and the panel and Sport Australia Board considered each eligible applications published criteria. 12. I provide the relevant citation from the ANOA report in this regard and also note that the Minister’s Office was provided with information on demand before the assessment process was completed. The ANOA report did acknowledge shortcomings but also that Sports Australia had been placed under considerable pressure within very short timelines of only six weeks to process 2045 (check no) applications, with no fewer than four requests from the Sports Minister’s staff to convey outcomes before the processing task was complete. I quote from the ANOA report regard the well-structured processes in place which included clear assessment criteria with transparent weightings. The report also that the Minister had been kept well informed but set aside strong recommendations made by Sports Australia. 13. Many with the highest scores missed out. The cut-off score was 74 being the minimum. Many scored between 73 and 98 but were unsuccessful, but the lowest scoring applicant with only 54 merit points was successful. 14. The process was described in the ANOA Report as follows; noting that there were three rounds of assessment. The sheer volume of applications, well over 2000 made it impossible for staff to work at the pace expected and most of the problems identified were associated with volume and staff limitations. However, the ANOA Report that the procedures in place were sound. 15. All of the recommendations made to Sports Australia for improvements, three in all were accepted and they immediately began to implement them. 16. There was a an unexpected volume of applications, some 2054, and Sport Australia had very limited timelines to complete assessments. They ceased handling assessments once the deadline had been reached. Some applications that would have been found ineligible had Sport Australia assessed them, but they managed to slip through. Exclusion grounds included starting work or completing work before applications were submitted, or starting work before the Commonwealth agreements with

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

intended recipients were in place. Other exclusionary grounds included whether the applicants were receiving funds from other sources. Late applications were said to be encouraged by parliamentarians including local MPs, as also were those that arrived on time. When the whole processes was complete some 43% were found to be ineligible. 17. One of the solicited applications that was successful in being awarded a grant was the Lilli Pilli Sports club in the electorate of Cook, NSW, the PM’s own electorate. They would have been excluded on the grounds of completing Stage 1 of the work before submitting an application but instead they received $200,000 whilst others with high scores and on time missed out. 18. The Department of Health, which is currently labelled as the “Portfolio” public sector department said that all applications were solicited 18.1. Was the Minister appropriately advised in writing on the merits of applications against the published criteria? “Appropriate advice on the assessed overall merits of each eligible application was provided by Sport Australia to the Minister. The assessment score clearly indicated the extent to which the Sport Australia assessment team, the assessment panel and Sport Australia board considered each eligible application had met the published criteria. Information on applications being assessed was requested and provided to the Minister’s Office before the assessment process had been completed. Information on applications was provided to the Minister’s Office on four occasions before the assessment process had been completed. Sport Australia provided a list of 2054 applications that had been received, excluding those that had (at that point in time) been assessed as ineligible (applications had closed less than two weeks earlier

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

4 Adherence to Published Assessment Processes and Program Criteria 1. I was not an applicant for a grant and have relied on the comprehensive scathing report by the Attorney-General through the Australian National Office of Audit and multiple media reports on this matter. 2. The media provided almost daily reports of distortions in the assessment process based on their own direct interviews with applicants who had missed out. 3. The ministerial office of the then Sports Minister, in collaboration with the PM’s office and most likely the Deputy PM, did not have processes in place that resembled anything like a fair orderly and nuanced approach to assessment. 4. ANOA staff have testified before the Committee that no fewer than 28 colour-coded spreadsheets were exchanged between ministerial offices with constant changes as to which applications would be successful. The assessment processes in place seem to have been replaced with the criteria that was mostly predicated on whether the facility was in a marginal seat prior to the election. Though Labor seats were targeted it was clearly only because they were marginal seats which the Coalition hoped to win over. 5. There were dozens of telling email communications found between ministerial offices clearly marked and coded with marginal seat considerations and target. An smoking gun email had been discovered by the ANOA team that was sent from home to work by a member of the Sports Minister’s staff that mentioned marginal seats and targeting. It was common knowledge that this was occurring and the ANOA staff would never have suggested political bias associated with marginal seats without justification. They have in their possession more evidence than the Secretary of the DPMC could possibly have obtained, particularly in that short time. The ANO assessment took ten months with several staff involved. 6. Four of the five submissions received so far, with the deadline being today were from disappointed applicants who felt short-changed because of process. One sent in a copy of the application to demonstrate that eligibility should have been achieved. Another who wrote in scored a very high score of 84, but still missed out. 7. It is not credible to suggest that the Minister was never shown the colour- coded spreadsheets and that fluke decisions matched up to perceived political bias in the assessments. The spreadsheets are in the possession of the ANOA, they spoke to ministerial staff exercising wide powers of investigation. It does not promote community confidence when denials are made. Clearly the Secretary of the PMC who was hampered with timelines and ability to compel staff to discuss the matter with him, but the ANOA office were persistent and diligent. 8. Applicants remain aggrieved over the whole process and no level of denial that political bias occurred will address that.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

9. Many entirely unaffected personally such as myself remain aggrieved that the process was so distorted and bias and that accountability and transparency principles cannot be relied upon. These issues raise far broader issues than which sporting clubs succeeded or whether the Minister declared her membership of two clubs that were successful A positive aspect was that the program guidelines were well structured and included clear assessment criteria with transparent weightings. 10. Some instances were blatant over the extent to which the “slush fund” that became available as a tool through which political goals were pursued. One example reported by the media was the Georgina Downer incident. She was a Liberal candidate for Mayo and saw grant allocations as a promotional opportunity for her. She was shown standing beside a giant mock-up cheque worth some $127,000 on the real cheque and shown on the mock-up with a photograph of the candidate’ face printed on the cheque. She argued that she was not distributing Commonwealth funds since the cheque had no intrinsic value, but it was clearly implied that this is what was behind this photo-shoot. She was not even in a seat, but simply trying to gain one using the sports grants as leverage. 10.1. She said the Fleurieu Peninsula club had asked her to come and present a "novelty cheque" because she had worked with the club to make sure its Community Sport Infrastructure grant application was successful. Boisvert, Eugene ABC Radio Adelaide Georgina Downer says novelty cheque was ‘absolutely not’ Commonwealth money 25 February 2019 http://www.abc.net.au/news/2019-02-25/downer-says-cheque-was- absolutely-not-commonwealth-money/10845904 11. Another photo showed Liberal Candidate for Corangamite standing beside a massive promotional banner claiming that she was fighting hard to obtain a swimming pool. Her electorate was marginal and in fact she did not win back her seat after all that effort, but has been elevated into the Senate from the backbench all the same. A sports club in her electorate wishing to install a swimming pool received a massive $30 million and a further $10 million was provided to another club in the same electorate. Bushfire victims could have benefited from assistance but the funds went to bolster electoral wins. 12. See ABC article of 7 February 2020 Snape, Jack and Probyn, Andrew (2020) (BC) Government’s $150 million sports program funnelled into swimming pools for marginal Coalition seats 7 February 2020 http://www.abc.net.au/news/2020-02-07/government-cash-splash- swimming-pools/11924850

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

Key points: • The PM announced a $150m fund for female change rooms and swimming pools on the eve of the election • Guidelines were promised but never published and the scheme was never open for applications • Two Liberal-held seats received 40 per cent of the funding

An email from Liberal Sarah Henderson — who lost Corangamite at the 2019 election but was made a senator this year — cited by the Geelong Advertiser two weeks ago states, "it seems unreasonable to me that council would not make a capital contribution when this is such a vital community facility". "No other council in Australia has received such substantial government funding to construct an aquatic facility," she said. The ABC understands the Surf Coast Council is worried that building the pool would require a significant contribution from the council, as well as major upkeep costs. A study six years ago found a 25-metre pool on the site would cost $30 million. Senator Henderson campaigned on the promise of a 50-metre pool. 13. The seat of Pearce was also marginal, and occupied by the current Attorney-General Christian Porter. To boost his chances, his a club in his area received $30 million out of $150 million set aside under another scheme that did not involve Sports Australia. That matter was reported as being devoid of any form of process, no application forms, no assessment process of any kind, no guidelines that were transparent. The Health Department confirmed that the applications were solicited and no spontaneous applications were accepted. 14. These ad hoc and blatantly biased examples of political stunts do not indicate a commitment to following due process whilst the matter was in the hands of politicians instead of Sports Australia. I provide a few media links in support. 15. I note that there were two separate sports grants schemes in play during the pre-election period. One was the total sum of $100 million appropriated by Parliament from the Department of Finance for the particular purpose of providing individual grants to eligible applicants who also passed the weight merits review process, associated with Sports Australia and undue influence with their assessment procedures and grant allocation recommendations based on a nuanced merits assessment process which included. 16. Some funds appeared to come out of the Infrastructure budget and were not associated with the Sports Australia grant allocations. See ABC article.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

Farrell, Paul, and McDonald, Alex (2020 Scott Morrison invited sailing club to apply of $8,000 grant for BBQ facilities, staffer then encouraged members to ‘vote Liberal http://www.abc.net.au/news/2020-02-05/cronulla-sailing-club-told-vote- liberal-grant-scott-morrison/11932600 17. This ABC article speaks of the Stronger Communities government grants which I understand again are always solicited applications. The Stronger Communities Program was introduced in 2015. “Cronulla Sailing Club received an $8,400 grant for a barbecue through the Stronger Communities Program After being told about the new barbecue, Cronulla Sailing Club members were told by a Scott Morrison staffer to 'vote Liberal ‘Stronger Communities Program applicants must be invited by their local MP to apply 18. It is common knowledge and repeatedly reported that various sports grants schemes have been used for politicisation. “The MP consults with a community group, handpicked by the MP, before inviting clubs to submit a formal application.

19. Up to $150,000 can be awarded in each electorate. The Department of Infrastructure is the ultimate decision maker.” 20. Mr Morrison invited the Cronulla Sailing club to apply for a Stronger Community grant. PHOTO: Cronulla Sailing Club received a grant of more than $8,000 for a new barbecue. (Source: Cronulla Sailing Club Facebook) 21. The club was subsequently awarded an $8,416.10 grant by the Department of Infrastructure in January 2018 for "permanent barbecue facilities". 22. The grant was intended to "improve usability of the space and eliminate the need for users to engage in heavy-lifting to move a portable barbecue". 23. A video obtained by 7.30 posted online by the sailing club in November 2018, three months after Mr Morrison became Prime Minister, shows a club official thanking a staff member from Mr Morrison's electorate office for assisting with the club's grant application. 24. A former attorney-general told AVC’s 7.30 report “"This alignment of taxpayers' money with political parties … it's beyond the pale," Tony Harris, a former auditor-general of NSW, told 7.30 25. The second process was more secretive and apparently involved no process at all that was transparent if it existed, no application forms, no merits review system, no voluntary applications. Instead surprised recipients of a total sum of an additional $150 million was produced and allocated to 11 marginal Liberal seats, two of which were provided with 40% of the total. Page 13 of 55

Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

26. These were the marginal seat of Pearce, Western Australia belonging to Liberal Cabinet Minister the Attorney-General Christian Porter in the sum of $30 million, and the other to the marginal Victorian seat of Corangamite occupied by Sarah Henderson, now a Senator, in the initial sum of $30 million and an additional sum of $10 million, between totalling a staggering $70 million. The remainder of the 2017-2018 funds went to 11 Liberal seats, save for the amount of $20 million set aside for the 2019-2020, and a further $50 million the following year. 27. The total of $250 million for the two parallel pre-election projects for sports infrastructure grants could have gone a long way towards re- settling bushfire victims if the money had been retained in the surplus budget. 28. This article cites a former Sports Commission employee and sports historian as saying whilst both parties used sport to campaign the Coalition was more effective in doing so in contestable electorates. Importantly this party expressed concern that the election-funding announcements were “bypassing the need for evidence-based decision- making in regards to community sport facilities.” Sky News (2020) Nearly half of sports grants recipients ineligible senate inquiry finds 202002214 http://www.skynews.com.au/details/_6132430887001 29. See embedded video with a short written paragraph in support 30. I provide some refutations against the video details for the purpose of refuting inaccurate statements made, notably by David Gillespie, MP The Nationals. Misinformation and misinterpretation of the facts as well as provisions enshrined in the law have abounded in this saga. This tends to mislead both media and the electorate. The Auditor-General’s written and oral testimony at the Select Senate Committee Inquiry clarifies the facts following a 10-month long audit of Sports Australia. 31. The reporter noted that: 31.1. “The Auditor-General revealed that 290 ineligible projects were funded by the then Minister Bridget McKenzie. The Auditor-General told the inquiry the final decision on the grant funding was made by Minister McKenzie, despite representations from the Prime Minister's office.” mentioning that the ANOA Report had identified political bias in grant allocations made. In 43% of grant allocations, as shown in video broadcasts on the first day of hearing of the Select Senate Committee, which received funding were ineligible mostly on the grounds of having started or completed works for which grants were sought, a disqualifying factor at the outset; or submitted applications a later after closure deadlines.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

31.2. The ANOA Report speaks of the two parallel assessment schemes

32. 10. In parallel, the Minister’s Office had commenced its own assessment process to identify which applications should be awarded funding. The Minister’s Office drew upon considerations other than those identified in the program guidelines, such as the location of projects, and also applied considerations that were inconsistent with the published guidelines. It was this assessment process that predominantly informed the Minister’s funding decisions, rather than Sport Australia’s process. This resulted in the assessment advice to the Minister being inconsistent with the approved program guidelines. 32.1.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

5 The role of the offices of the Minister, the Prime Minister and Deputy Prime Minister and any external parties in deterring grant awards 33. I note the disclaimers made by Mr Phil Gaetjens the former Chief of Staff to the Prime Minister Secretary of the Department of Prime Minister and Cabinet in his six-page submission dated 14 February 2020, to the Select Senate Committee on Grant Administration, which represented not the full report (the Gaetjens) that he prepared at the request of the Prime Minister in the space of a few weeks, whereas the staff of the Attorney General Grant Hehir of the respected Australian National Office of Audit spent ten months in their thorough audit of Sports Australia, which audit had been triggered by a number of factors, only one of which was associated with the absence of the application of the Commonwealth Grant Rules and Guidelines. 34. As a concerned member of the community and voter I have spent time familiarising myself with this matter and have not the smallest reason to doubt the veracity of the findings of the ANOA, whose report was presented to Parliament on 15 January 2020 and which I feel sure the Committee must have read thoroughly. Therefore I will restrict myself to re-producing directly from the report a handful of findings and opinions that assist in honing in on some of the most salient points in answer to the invitation of the Committee to comment on the perceived role of senior Cabinet Members, including the Prime Minister and his Ministerial Office. 35. The committee will draw its own conclusions, but I believe the entire community watching on will wish to rely upon the ANOA and its findings as a respected statutory authority whose credibility and thoroughness could not possibly be questioned. I have read the ANOA report and dozens of credible media reports as well some of which I provide further context and perspective. 36. It can hardly be a matter for speculation any longer that the ministerial staff of the Prime Minister and those of the former Sports Minister were deeply involved in this matter. The evidence is in the form of literally dozens of email communications between the staff of the two ministers as well as exchange of emailed colour-coded spreadsheets, not just one such, but at least 28 or them, on occasion amended versions within the space of a few hours of each other. The community has also had a glimpse of these when they were waved before the nose of the PM at the time of his National Press Club address on Wednesday 29 January 2002 by the Political Editor for the national broadcaster, the ABC whilst he joined other reporters in posing awkward questions, as they should.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

37. I am tempted to parse and refute each of the claims made by the Secretary to the Department of Prime Minister and Cabinet, but will exercise restraint here and merely extract from it paragraph 17 on page 3 of his submission to the Committee which said: 38. “So on the evidence available to me, there is material divergence between actual outcomes of all funded projects and the approach identified on the Adviser’s spreadsheet. This does not accord with the ANOA Report (in the text box on page 52) which states ‘The award of funding reflected the approach documented by the Minister’s Office of focusing on ‘marginal’ electorates held by the Coalition, as well as those electorates held by other parties or independent members that were to be targeted by the Coalition at the 2019 Election.” 39. Clearly grants afforded to those electorates occupied by other parties including Labor were on the basis of being marginal seats in the hope of boosting Coalition votes not in order to assist the other parties. The whole thing has become so political and opportunistic. A substantial proportion of the community believes that this is exploitation of public funds to suit political goals. 40. In contrast I provide the ANOA findings regarding distribution bias, which carry more weight with me than the statements made by the PM’s Departmental Secretary who admits that his findings were compromised by not having access to the data that the ANOA relied upon which is hardly surprising since he did not spend ten months investigating the matter

24. There was evidence of distribution bias in the award of grant funding. Overall statistics indicate that the award of funding was consistent with the population of eligible applications received by state/territory, but was not consistent with the assessed merit of applications. The award of funding reflected the approach documented by the Minister’s Office of focusing on ‘marginal’ electorates held by the Coalition as well as those electorates held by other parties or independent members that were to be ‘targeted’ by the Coalition at the 2019 Election. Applications from projects located in those electorates were more successful in being awarded funding than if funding was allocated on the basis of merit assessed against the published program guidelines.

25. Timely advice on funding decisions was not provided to applicants.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

41. The several key personnel from the ANOA Office were conscientious, described their methodology in conducting the audit which were reported as follows: 42.

1.8 The audit methodology included:

• examination of entity records, including email records, electronic and hard copy documentation and grants management system data;

• identifying and extracting data for visualising application demographics, application assessment results, funding recommendations and funding decisions taken;

• interviews of relevant entity staff; and evidence (including sworn testimony and documentation) obtained using the powers provided by section 32 of the Auditor-General Act 1997 (Auditor-General Act) from two key individuals from within the Minister’s Office at the time funding was awarded. 43. The Gaetjens submission which represents a fraction of his findings put together within less than a month since the ANOA report was not tabled till 15 January, and the Gaetjens submission is dated 14 February 202, suggests inconsistencies but also concedes that the author has only been able to rely upon what was before him and did not have the same investigative powers available to him as did the Audit Office. 44. The Gaetjens submissions also says that had the Sports Australia’s recommendations been adopted 30 electorates would not have received grants at all. This would have been a fair outcome since if grants applications were rejected it would have been because of ineligibility. There was a cut-off score point of 74. The ANOA report identifies many applicants scoring between 73 and 98 points. The lowest scoring applicant received a merits score of 54, twenty points below the minimum but still was awarded a grant being in a marginal seat. 45. The Gaetjens report relied on the suggestions that applications from ‘marginal’ or ‘targeted’ seats were approved by the Minister at a statistically similar ratio of 32 per cent compared to the number of applications from other electors at 36 per cent. This is hardly a convincing approach since the whole idea was to weight the applications by merit not by location.

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46. The ANOA report does not think that mere reference to statistics is sufficient in terms of distribution assessment. The findings made in the Minister’s office and the allocations made were not consistent with merits assessments and failed to use the system in place for weighted assessment. 47. The Gaetjens report claims that he was unable to find evidence that the separate funding approval process conducted in the Minister’s office was unduly influence by reference to ‘marginal’ or ‘targeted’ electorates. Evidence provided to him, he said “indicated that the Adviser’s spreadsheet was developed by one member of staff in the Minister’s Office, using information provided by Sport Australia in September 2018 as a worksheet to support an increase in funding for the Program. 48. Mr. Gaetjens claims that he spoke to the former Sports Minister, who had advised in response to a direct question that she had never seen the Adviser’s spreadsheet and that neither she nor her staff based their assessments on it, Her Chief of staff claim categorically that she had not shown the spreadsheet to the Minister. This begs the question why so many colour coded spreadsheets were produced; according to ANOA staff about 28, changing sometimes several times a day. The Gaetjens conclusions were quite different to those of the ANOA. 49. Media reports who independently made their inquiries included the handful shown below. Many more can be made available upon request: Conifer, Dan (2020) ABC Audit Office says Morrison’s Office shared partisan colour-coded spreadsheets http://www.abc.net.au/news/2020-02-13/sports-grants-senate-auditor-general- bridget-mckenzie/11962104 Key points: • The Senate hears the offices of the PM and then-sports minister shared "dozens" of versions of colour-coded spreadsheets • Audit Office officials say the Prime Minister's office made direct and indirect representations to Bridget McKenzie's office • Officials said the PM's office indicated projects that should be included in the list of approved grants The evidence paints a picture of Mr Morrison's office being more heavily involved than the Government has admitted to date. More than 40 per cent of the projects were ineligible for funding by the time agreements were signed, the hearing was also told. That was mostly because many sporting clubs had started work — or even finished projects — before inking deals with the Commonwealth.” Probyn, Andrew (2020) ABC Sport Australia complained about political interference in this Government’s sports grants program 20200129 http://www.abc.net.au/news/2020-01-28/sport-australia-complained-pre- election-government-grants/11905250 Page 19 of 55

Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

The agency charged with administering the scandal-plagued sports grant scheme warned the Morrison Government that its interference in the $100 million program was compromising its independence. http://www.abc.net.au/news/2020-01-28/sport-australia-complained-pre- election-government-grants/11905250 50. I cite from that Andrew Probyn article below: “Right from the outset, it is clear the Community Sport Infrastructure Grant Program was highly politicised, with Senator McKenzie's office colour-coding the nearly 2,000 grant applications according to the party that held the electorate. As revealed in the auditor-general's report, projects deemed to be of high merit by Sport Australia did not always get federal funding. In fact, the two highest-rated applications were overlooked in favour of projects with relatively low merit under established guidelines. A football club in the Victorian Liberal-held marginal seat of La Trobe received a $500,000 grant despite having an assessment score of 50 out of 100, when a roller derby upgrade in the safe Nationals seat of Gippsland did not get a cent despite its 98 rating.” The ABC can reveal that one month before the election was called, Sport Australia wrote to Senator McKenzie outlining its fears that it was being compromised by political interference. But Phil Gaetjens for the DPMC suggests there is nothing to see here, everything evens out statistically. Snape, Jack and Probyn, Andrew (2020) (BC) Government’s $150 million sports program funnelled into swimming pools for marginal Coalition seats 20200207 http://www.abc.net.au/news/2020-02-07/government-cash-splash- swimming-pools/11924850 51. I cite again below from Snape, Jack and Probyn, Andrew (2020) ABC 7 February 2020, with gratitude in advance for permitting citation for an excellent cause and thanks for keeping this issue alive. I note that Andrew Probyn co-author is Political Editor for the ABC, and Jack Snape political reporter has authored many articles on this topic as Dan Conifer. 52. A significant observation from these clips from the article is that at the time the program was within the Department of Infrastructure oversee by the Deputy PM Minister Michael McCormack. At the time of the appointment of Richard Colbeck as Minister of Youth and Sport the program transferred to the Department of Health.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

53. It remains a mystery how former Sports Minister Bridget McKenzie came into the picture since she was not part of the Department of Infrastructure at the time of her involvement. How many ministers does it take to oversee the project given that Sports Australia has been quietly minding its own business since 1989 in accordance with its legal authority to administer sports grants through assessment and allocation decisions? 54. In any case there is that tiny matter of legal authority and discretion. Do all Ministers think that these are shared commodities without the benefit of sanction through statute? Legal authority is conferred by Parliament through statute and is never self-conferred and not normally shared by multiple ministers. 55. Snape, Jack and Probyn, Andrew (2020) (BC) Government’s $150 million sports program funnelled into swimming pools for marginal Coalition seats 7 February 2020 http://www.abc.net.au.news/2020-02-07/government-cash-splash-swimming- pools/11924850 56. “The Prime Minister's press release in March 2019 launching the scheme promised "further details on the change room and swimming facilities fund will be released later in 2019". 57. It remained within the Department of Infrastructure, overseen by Deputy Prime Minister Michael McCormack, and was included in that department's incoming government brief. 58. The brief stated "advice on guidelines and program arrangements will be provided in June 2019". 59. The program was handed to the Department of Health under responsibility of Sport Minister Richard Colbeck in August. 60. The Health Department stated the program was not open to applications, and "all proponents were selected by Government". 61. It said there were are no published guidelines nor was there criteria for the allocation of funding. 62. The Department of Health said Senator Colbeck had responsibility for the program in consultation with the Prime Minister.” 63. Audit Office says Scott Morrison and Bridget McKenzie's office shared spreadsheets 64. In addition, at least five grant applications arrived well after the deadline for receipt of applications, or else had been receiving grant funds from other sources.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

65. It was my understanding that the applications were solicited and that some local MP’s had cooperated with identifying applicants and encouraging them to apply. I also understand the in the marginal electorate of Longman, Queensland parliamentarians may have been communicating their wishes for preferred assessments of applications coming from that electorate. 66. I do not believe from all I have read and digested that the former Sports Minister acted alone in this, but instead was greatly assisted in her final decision-making processes by others driven by political goals. 67. Mr Brian Boyd Executive Director of Sports Australia testified before the Select Senate Committee on 14 February, saying that 43% of funded projects were ineligible under the guidelines. This was mainly because of commencing or completing work before applications were received, or else Mr Boyd says spreadsheets listing potential projects were exchanged between the Bridget McKenzie's and the Prime Minister's offices. Source: ABC News | Duration: 1min 39sec VIDEO: ANAO's Brian Boyd says 43 per cent of funded projects were ineligible under the guidelines (ABC News) 68. Not only were such spreadsheets exchanged between the PM’s office and the Sports Minister’s Office, but the office apparently admitted to it, which was unnecessary really since the ANOA office had possession of them. The evidence kept building as time went on. The smoking gun first discovered was apparently an email sent from the home of one of the Minister’s staff to the office mentioning the words “marginal” and “targeting” and the investigation progressed there was documented evidence to support all of the views and findings of the ANOA whereas the DPMC cherry-picks and admits on limitations in accessing data. As to suggesting that Ms McKenzie was the final decision maker but never sighted the spreadsheets at all, this is a little too much to take in, given the evidence and the pressure placed on Sports Australia to provide information to the Minister’s office given the pressure to get everything absolutely right for election day and with so much to attend to. 69. I provide another short excerpt from the ANOA Report: 70. whose communications with the ministerial office of the former Sports Minister Bridget McKenzie over the alternative process adopted in the assessment process of applications received that was overtaken by the Minister and her staff. 6 Other Relevant Matters 71. I appreciate the willingness of this Committee to provide comment on matters outside of its terms of reference. I have taken this literally. The first cab off the rank is the complex issues of legal authority discretion and associated perceived unlawfulness, or operating “outside the scope of the law.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

6.1 Legal Authority and unfettered discretion and perceptions of unlawfulness 72. The sports grant saga provides a useful example to use in discussing widespread misconceptions amongst parliamentarians about the scope of their discretion in making decisions. 73. A mandate to govern does not mean that decisions may made without due regard for the principles of transparency, accountability integrity, probity and importantly misinterpretation of discretionary powers. I deal with the last matter here, and selectively address the others in my Introduction and notably my Section 4 Recommendations and sub- section Suggested Preamble and in response to selected provisions from this Bill. 74. I start with noting that in this matter it would seem there has been misinterpretation of the terms legal authority and discretion. These are terms with a particular legal meaning and should not be employed casually as lay terms when in the course of execution of parliamentary duties. 75. In support I shortly cite in the subsection below the professorial legal academic views of Professor of Constitutional Law at University of Sydney, who has kindly given up her time to comment on this particular issue in this particular issue. 76. First I deal with the inclusion of the misleading terms contained in the Statement of Ministerial Standards relied upon as if it had legal clout or enforceability as a Code attached to statute by mandate. It has no legal import but it does contain terms that are normally used in this context with reference to particular legal meanings and should be not indiscriminately used less the literal invitation to exercise unfettered discretion leads parliamentarians into hot water or even unlawfulness. The Statement contains the observation that parliamentarians enjoy “considerable privilege” and “wide discretion” which could be read as license to do whatever they wish whenever they wish. 77. Legal authority is never self-conferred, but instead is provided by statute and may or may not carry discretion. Discretion on the other hand is conceptually impotent and inaccessible unless legal authority exists. There are many nuances in interpreting who has authority and whether discretion exists. The answer may lie in forensic examination of all applicable statutes and in the Constitution, which makes no mention at all of sports grants. 78. Professor Twomey has also mentioned administrative law which requires both Ministers and the public service to be accountable as to process and justification for decisions made, as to the particular instruments that are associated with the Australian Sports Commission an incorporated Commonwealth entity afforded unusual autonomy and clear legal authority to administer grant assessment and allocation, with the most limited scope for the Finance Minister to object to such decisions on the narrow grounds that the money would be used for an improper purpose.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

Proper purpose is defined within the Public Governance Performance and Accountability Act 2103 at Section 7 Interpretation, as “efficient, effective, economical and ethical.” 79. It would be challenging to find that grant decisions made by Sports Australia, established under the Australian Sports Commission Act 1989 were anything but appropriate. The Auditor-General had found their procedures formulated without the assistance of the Sports Minister or any other Minister, to be sound, although in this matter they were placed under undue pressure within short timelines and over 2000 applications to process, having to account to the Sports Minister’s staff on at least four occasions before the assessment process was completed.\ 80. The sports grant saga provides a useful example to use in discussing widespread misconceptions amongst parliamentarians about the scope of their discretion in making decisions. 81. A mandate to govern does not mean that decisions may made without due regard for the principles of transparency, accountability integrity, probity and importantly misinterpretation of discretionary powers. I deal with the last matter here, and selectively address the others in my Introduction and notably my Section 4 Recommendations and sub- section Suggested Preamble and in response to selected provisions from this Bill. 82. The Public Service broad values are described in the Public Service Act 1999, which is useful to the extent that parliamentarians deal with public service agencies all the time, and of course the example they set one way or another will impact on the quality of their relationship with staff from both public services agencies and others that are incorporated. 83. In the case of the Sports Grants Saga, a terrible impression was gained by the Australian Sports Commission (ASC) an independent incorporated statutory authority badged as Sports Australia. They had set accountabilities, a professionalism they exercise in their wide range of duties not restricted to assessing merits of grant applications, and expected to retain control of the grant processes. The time and effort they took with this under procedures and nuances developed by them were swept aside without due regard to fundamental courtesies and respect, leaving aside the legalities of the matter, which is what this additional section is about. 84. Effective relationships must be maintained by those elected to parliament and this saga has highlight so much that was wrong about the whole thing that there are many lessons to be learned from it, but this is not necessarily all about one person, a personality approach or matters as simple as that. It may well have been that the approach taken was one that involved others in formulating the general approach that was to have been taken in this matter.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

85. My understanding is that many grants were solicited with the help of local MPs and in discussion with others including the former Sports Minister. Another consideration may be that the Finance Minister, the Prime Minister and Deputy Prime Minister sit together on the Expenditure Review Committee and would have had to approve a block grant allocation to Sports Australia for that Authority to allocate after a nuanced merits assessment using the comparative merits assessment criteria already in place. It is not usual practice for the legal authority of Sports Australia to be undermined in the way it was. The ANOA Report had clearly stated that the Minister ran her own parallel scheme and approved applications in marginal seats. 86. This was explained away in paragraph 27 of the Gaetjens report as follows: 87. “Ultimately or the reasons I have outlined my advice to the Prime Minister concluded that in exercising her discretion as decision maker for the Program Senator McKenzie acting within the remit of the Guidelines. Further, the evidence that I reviewed does not support the suggestion that political considerations were the primary determining factor in the Minister’s decisions to approve the grants. On this basis, and while there were shortcomings in the administration of the Program, I concluded Senator McKenzie did not act in breach of the Standards with respect to fairness.” 88. His only finding of breaching the Standards was by failing to declare her memberships of two organisations and that she had had actual conflict of interest when awarding funding to one of those organisations, the Wangaratta Clay Target Club, which was neither declared to the Prime Minister nor managed. 89. On the issue of discretion, clearly the Secretary of the DPMC Phil Gaetjens had not informed himself of the nuances in determining whether discretion existed at all. According to its establishment enactment the Australian Sports Commission, the assessor of applications and decision maker should have been Sports Australia an independent incorporated statutory authority whose functions and powers are laid out under Sections 7 and 8 of the ASC Act and include under 7(n) 90. The ANO Report made these conclusions and expanded on them in the detail of the report: 91. The award of grant funding was not informed by an appropriate assessment process and sound advice. 92. The successful applications were not those that had been assessed as the most meritorious in terms of the published program guidelines.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

93. It was reported and confirmed in the Sports Australia list of allocated grants, that they were distributed in that way. Though Labor benefited the gross sum allocated to Labor seats was far lower than for the Nationals and Liberals, and they were all marginal seats anyway as shown on the colour-coded charts unearthed by the Political Editor for the ABC, Andrew Probyn. 94. I submit that the former Senator Bridget McKenzie in her former capacity as Sports Minister presumed legal authority and/or discretion to which she had no entitlement. She may not have been aware that the same latitude that Ministers may have when dealing public service departments with which they are associated does not apply when dealing with an incorporated statutory authority such as Sports Australia, since 2018 the badged name of the Australian Sports Commission established under the Australian Sports Commission Act 1989. Under that statute Sports Australia as it is now known was conferred with considerable autonomy in a wide range of responsibilities described in Section 7 and 8 of the Act as follows: http://www.legislation.gov.au/Details/C2016C01020 Section 7 Functions (Australian Sports Commission Act 1989) (1) The functions of the Commission are: (a) to advise the Minister in relation to the development of sport (b) to co-ordinate activities in Australia for the development of sport\ (c) to develop and implement programs that promote equality of access to, and participation in, sport by all Australians\ (d) to develop and implement programs for the recognition and development of: (i) persons who excel, or who have the potential to excel, in sport; and (ii) persons who have achieved, or who have the potential to achieve, standards of excellence as sports coaches, umpires, referees or officials essential to the conduct of sport; (e) to initiate, encourage and facilitate research and development in relation to sport; (f) to undertake research and development related to sports science and sports medicine; (g) to provide sports medicine services and sports science services to persons participating in programs of the Commission; (h) to establish, manage, develop and maintain facilities for the purposes of the Commission; (j) to collect and distribute information, and provide advice, on matters related to the activities of the Commission;

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

(k) for the purpose of fostering co-operation in sport between Australia and other countries, to provide access to persons from other countries to the resources, services and facilities of the Commission;\ (m) to raise money through the Australian Sports Foundation, or by other means, for the purposes of the Commission I note there is no clause (o) shown in the enactment (n) to administer and expend money appropriated by the Parliament, or raised in accordance with paragraph (m), for the purposes of the Commission (p) to consult and co-operate with appropriate authorities of the Commonwealth, of the States and of the Territories, and with other persons, associations and organisations, on matters related to the activities of the Commission; an (q) to provide advice on matters related to sport to the Australian Olympic Federation or other persons, bodies or associations; and (r) to co-operate with national and international sporting organisations in aiming to foster a sporting environment that is free from the unsanctioned use of performance enhancing drugs and doping methods. (2) The functions of the Commission may be performed within or outside Australia. (3) The Commission may perform any of its functions in co-operation with a State or Territory or any person, association or organisation. (4) Subject to section 11, the function of the Commission under paragraph (1)(q) may be performed at the discretion of the Commission. (4A) The function of the Commission under paragraph (1)(r) may only be performed to the extent that it does not overlap any of the functions of the Chief Executive Officer of the Australian Sports Anti-Doping Authority. (5) The Commission may perform its functions to the extent only that they are not in excess of the functions that may be conferred on it by virtue of any of the legislative powers of the Parliament, and, in particular, may perform its functions: (a) by way of expenditure of money that is available for the purposes of the Commission in accordance with an appropriation made by the Parliament (b) for purposes related to the collection of statistics (c) for purposes related to external affairs; and (d) for purposes in relation to a Territory (6) In this section, Australian Olympic Federation means the Australian Olympic Federation Incorporated, being an association incorporated on 24 April 1985 under the Associations Incorporation Act 1985 of Victoria.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

Section 8 Powers (Australian Sports Commission Act 1989 (1) The Commission has power to do all things necessary or convenient to be done for or in connection with the performance of its functions and, in particular, may: (a) enter into contracts; and (b) acquire, hold and dispose of real or personal property; and (c) occupy, use and control any land or building owned or held under lease by the Commonwealth and made available for the purposes of the Commission; and (d) make grants or lend money, and provide scholarships or like benefits; and (e) appoint agents and attorneys, and act as an agent for other persons; an (f) engage persons to perform services for the Commission; and (g) accept gifts, grants, bequests and devises made to the Commission (whether on trust or otherwise) and act as trustee of money or other property vested in the Commission on trust; and (h) erect buildings and structures and carry out works; and (j) obtain commercial sponsorship for the Commission and participate in marketing arrangements involving the endorsement by the Commission of products and services associated with sport; (k) arrange for the manufacture of, and distribute (whether by way of sale or otherwise), any article or thing bearing a mark, symbol or writing that is associated with the Commission; and (m) provide (whether by sale or otherwise) goods and services to persons using, or otherwise attending at, facilities of the Commission; a (ma) despite subsection 46(2), obtain goods or services on credit from any person by the use of a credit card; a (n) do anything incidental to any of its powers. (2) The Commission may charge such fees, or impose such charges, as are reasonable in respect of (a) access to, or use of, any of the resources or facilities of the Commission; (b) the provision of programs, services, information or advice by the Commission; and

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

(c) the admission of persons to events and activities conducted by the Commission. (3) The powers of the Commission may be exercised within or outside Australia. 95. I believe I can spot one or two matters that could have given rise to confusion. Section 11 of the Australian Sports Commission refers to the “Minister being able to give direction” but the trick is deciding which Minister is referred to. The only reference to the identity of the correct Ministerial portfolio lies in Section 3 Definition which mentions the Finance Minister, not the Sports Minister. This is consistent with reporting responsibility to the Finance Minister who needs to be satisfied that the funds are being used for a “proper purpose” which is defined in definitions contained in the Public Governance Performance and Accountability Act 2013 as “efficient, effective, economical and ethical. Section 11 Minister may give directions (1) Subject to subsection (2), the Minister may give written directions to the Commission with respect to the policies and practices to be followed by the Commission in the performance of its functions, and the exercise of its powers, and the Commission shall comply with the directions (2) The Minister shall not give a direction to the Commission under subsection (1) unless the Minister: (a) has informed the Commission, in writing, that the Minister is considering giving the direction; and (b) has given the Chairperson an opportunity to discuss the need for the proposed direction with the Minister. (3) The Minister shall cause a copy of each direction given under subsection (1): (a) to be published in the Gazette as soon as practicable after giving the direction; and (b) to be laid before each House of the Parliament within 15 sitting days of that House after giving the direction. 96. The same provisions and restrictions are also contained in Division 9, Section 71 of the Public Governance Performance and Accountability Act 2013 which I have been happy to cite and I believe the correct interpretation of the portfolio involved in a limited way is in fact the Finance Minister as it is this minister who has to justify decisions about fiscal matters and in any case must pass them through the Expenditure Review Committee. See also provisions for appropriation from the Consolidated Revenue Fund (CRF). 97. My view is that informal and unenforceable documents relating to conduct should be replaced with instruments with legal clout and enforceability.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

98. I note from Section 11 of the Public Governance Performance and Accountability Act 2013 that there are structural legal differences between Commonwealth non-corporate entities which are part of the Commonwealth. I cite from Section 11, but also happy cite from the Interpretation and from Section 9; and Section 3 of the Australian Sports Commission Act 1989, which specifically mentions the Finance Minister. It all adds up for the Finance Minister, not the Sports minister. 99. I provide an extract from the Public Governance Performance and Accountability Act 2013. This is hardly an instrument that a Sports Minister would be qualified or interested in administering given the onerous fiscal duties that go with it. No colour-spreadsheets here with marked marginal seats, its all about tiny figures, macros and complicated mathematical calculations and creative accounting. It belongs in the Finance Minister’s portfolio, so a simple matter of jurisdictional confusion. Section 11 Types of Commonwealth entities There are 2 types of Commonwealth entities: (a) corporate Commonwealth entity, which is a Commonwealth entity that is a body corporate; and (b) a non-corporate Commonwealth entity, which is a Commonwealth entity that is not a body corporate. Note: Corporate Commonwealth entities are legally separate from the Commonwealth, whereas non-corporate Commonwealth entities are part of the Commonwealth. 100. This has implications for grant administration generally which is not restricted to sports grant administration, but any allocation from the Consolidated Revenue Fund (CRF which is covered in other sections of the Act. 101. Additionally this has implications for the level of interference that the Commonwealth may exercise in relation to incorporated entities, even if they are provided with funds for operational or capital expenditure purposes or for the purpose of block grants which are appropriated by Parliament for particular purposes which must be approved by the Expenditure Review Committee first. I discuss separately above some considerations relating to legal authority discretion and perceptions of unlawfulness in assuming legal authority or discretion beyond allowable limits. This is well illustrated in my illustrative examples regarding sports grant administration, but it is not my intent to restrict the issues to what took place with sports grants handling in 2018-2019 or to sports grants at all, 102. The principles canvassed here are mostly about whether the Commonwealth has an inherent right to interfere at all with corporately structured entities provided with legal authority under statute and afforded considerably more autonomy in executing the functions with which they are endowed under statute.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

103. I also reflect the views professorial views expressed by legal academic in constitutional law Professor Anne Twomey on these matters. She has pointed out that the Constitution does not mention grant administration at all, and that there are other considerations regarding grant administration that need to be considered when evaluating the possibility of unlawful conduct or as otherwise expressed “operating outside the scope of the law.” 104. In the meantime the issue of grant administration through any fund, including the Consolidated Revenue Fund where applicable remains on the table for resolution as the current system is inequitable, could conceivably be seen as affording excessive discretion to a single Minister, being the Finance Minister not solely restricted to Section 22 of the Public Governance Performance and Accountability Act 2013, but which is usefully evoked as an example of conferred discretion to alter the original intent of Parliament in seeking to secure implementation of the Commonwealth Grant Rules and Guidelines (CGRG) within such schemes as the Community Grant Sports Infrastructure Scheme, provided as an example only and not raised here in the context or sole application to a single grant type. Grants of all descriptions are made and the existing CGRG are not restricted to a particular class of grant. 105. I have already covered some ground in relation to unlawfulness in exceeding boundaries of legal authority and discretion which are always conferred by statute with or without limitations but would not usually be conferred as matters of indiscriminate discretion where this exists at all, but is conceptually impotent if legal authority does not pre-exist the exercise of discretion, both terms carrying a particular legal meaning though using terms that are also common in everyday parlance as lay terms in common use. In the context of examining unlawfulness considerations I note that Professor Anne Twomey academic expert in Constitutional Law with a thorough knowledge also of administrative law has questioned whether the entire sports grants scheme may be categorised in that way.. See my discussion at 3.8 above and elsewhere. 106. Whether or not the CGRCs have been devised by the Finance Department, which administers the scheme in a manner that fully considers the implications of employing discrepant schemes for various grant schemes or whether there may be room for further refinement of the entire CGRC parameters is a matter for experts to determine. 107. There are some immediate gaps and these have already been highlighted by the Auditor-General, whose opinion I have cited that consistency should be the cornerstone, recommending that the CGRC should apply to all incorporated entities receiving funds.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

108. This does not mean that other than requiring suitable prescribed financial reporting as required for instance under Section 71 of the PGPA Act 2013 and elsewhere without regard to where authority boundaries lie. Under Section 71 the Finance Minister (being the only Minister mentioned in the Interpretation Section of the Act (not Sports Minister, Youth and Sports Minister, Health Minister or Infrastructure Minister, all of whom may have some peripheral interest in maintaining collaborative and/or cooperative arrangements with a non-commonwealth entity legally structured under Corporations Act 2001 provisions and accountable under that enactment and their own establishment enactment, as well as for financial reporting purposes under the PGPA Act 2013. 109. Section 71 of the PGPA Act 2020 provides for some mandated accountability by the Finance Minister, though the existence of what may well be engrossing errors in the inconsistent use of the plural and singular case and in use of pronouns may have resulted in misinterpretation as to how many ministers are involved. 110. The absence of applicability of the CGRC to Sports Australia and other such incorporated statutory authorities is regrettable as the accountabilities are meant to be reciprocal, and become blurred and diluted if the Commonwealth opts out of its share of accountability under multiple provisions, which could explain why a decision was made not to apply the CGRCs to incorporated bodies. 111. The Auditor-General did not see a good reason why they should not. I still do not mean to imply that they are perfectly structured or that there may not be certain accountability gaps not least that the Finance Minister and the Department itself seems to have been afforded a high degree of autonomy that releases them from statutory requirements through the opportunity to make “government policy orders.” In principle 112. I have always been resistant to opportunities for orders of that nature to be routine and without checks and balances, if they must exist at all. Theo that I have looked at are normally gazetted, which is not a satisfactory method of providing proper transparency and can occur on an ad hoc basis without the justification that one would expect when making major changes to legislative provisions. Rule changes ae made frequently without proper scrutiny. 113. The Australian Energy Market Commission (AEMC) for example has made many hundreds of such changes in since its establishment in 2004, most usually with the proponents being industry players with a vested interest who are in fact collectively the real governing body for energy policy and the most significant influencers for legislative provisions and rules with the force of law but without the benefit of parliamentary scrutiny.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

114. The AEMC is an exceptionally powerful body that enjoys incorporation, the combined role of being policy maker and Rule Maker Extraordinaire, and has not one but two major regulators under its control, being the Australian Energy Regulator and the Australian Energy Market Operator which deals with procedural matters and market settlement. 115. I have come across grievances expressed by State Ministers that the intent of General Exemption Orders, for example have been misunderstood, misinterpreted and misapplied by corporately structured regulators motivated to claim complete independence on the grounds alone of their corporate legal structure. Despite expressing those grievances, such ministers have not been able to counteract the impacts of erosion of legislative intent. On the other side of the spectrum there are Ministers whose conduct has been cause for concern. One of them is before the courts on criminal charges, which is more serious than just toying with parliamentary intent. I recall corresponding with that particular minister to no avail. Now he has more to answer for than deficient energy policy 116. I have mentioned this elsewhere in providing some examples of ad hoc arrangements and utility governance by way of illustrative material, but will refrain from opportunistic tangent discussion here. 117. As an institution Parliament may well be interested in studying the extent of the erosion of its authority by stealth, and it is in far better position to counteract this phenomenon than those from the community occasionally engaging with the parliamentary space. Some of the fault may lie with the parliamentarians who permit this erosion by devising and rubber- stamping laws that contain inherent invitations to dilute their strength by providing for at will ad hoc changes through the rule-based system and conferring on individual ministerial portfolios or their associated departments decision-making powers that reflect autonomy rather than a democratic approach to addressing policy and legislative provision. 118. Incorporated components of the public service are not the sole culprits. Some departments are also responsible for measures through which accountability is compromised. 119. Gazetted decisions have limited value in addressing transparency and accountability provisions. They convey decisions but not justification, they are difficult to access because they appear in no particular order in consolidated digests and are not routinely accessed by anyone. 120. It may well be that the CGRG Framework and whole Community Grant Framework, or any other grant framework that may exist would benefit from an overhaul and enhanced scrutiny, but for the sake of consistency it would be good to have just one set of provisions that require scrutiny than several or none at all, in which case ad hoc decisions are made and policy on the run becomes the norm.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

121. I have illustrated this in one of the two sports grants schemes that came under the scrutiny of the court of public opinion and the media and remain in that space, which is unfortunate for parliamentarians wishing to attract less not more attention on such matters. As discussed elsewhere in this and other sections, in the scheme not involving Sports Australia there were no procedures, no guidelines, no application forms, no merits assessment for grant allocations appropriated from the public purse which is an illustration of zero policy instead of just deficient policy. 122. Section 22 Corporate Commonwealth entities Public Governance Performance and Accountability act 2013 (1) The Finance Minister may make an order (a government policy order) that specifies a policy of the Australian Government that is to apply in relation to one or more corporate Commonwealth entities. (2) Before making a government policy order that applies in relation to a corporate Commonwealth entity, the Finance Minister must be satisfied that the Minister responsible for the policy has consulted the entity on the application of the policy. (3) If a government policy order applies in relation to a corporate Commonwealth entity, the accountable authority of the entity must ensure that the order is complied with: (a) in relation to the entity; and (b) in relation to any subsidiary of the entity, so far as practicable. (4) A government policy order is a legislative instrument, but section 42 (disallowance) of the Legislation Act 2003 does not apply to it. Source: Public Governance Performance and Accountability Act 2013 (administered by Finance Minister). See CGRG administered by Finance Department http://www.legislation.gov.au/Details/C2017C00269 123. My comment on Section 22 PGPA Act: 124. The Public Governance Performance and Accountability Act 2013 (PGPA Act 2013 is administered by the Finance Minister (not the Sports Minister or the Youth and Sports Minister or any other Minister. The establishment enactment for the Australian Sports Commission, since 2018 badged as Sports Australia, as an incorporated Commonwealth independent statutory authority under the ASC Act 1989 under Section 7 (n) of that Act has been conferred by statute with legal authority to undertake assessments of grant applications destined for grant allocations from block grants appropriated by Parliament for the purpose of promoting sport interests nationally and internationally, along with under other subclauses of Section 7 “Functions.”

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

(n) to administer and expend money appropriated by the Parliament, or raised in accordance with paragraph (m), for the purposes of the Commission Section 3 Interpretation Australian Sports Commission Act 1989 (C2016C01020) Current Acts http://www.legislation.gov.au/Details/C2016C01020 Finance Minister means the Minister administering the Public Governance, Performance and Accountability Act 2013. 125. This definition is from the ASC Act which cross references to the administrator of the PGPA Act 2013, and cannot possibly mean Sports Minister or any other minister. This relates to financial reportability. In the limited circumstances that intervention is allowed full justification needs to be made especially if this relates to overturning assessment or allocation of block sports infrastructure grants to individual applicants which is firmly the province of the ASC now badged as Sports Australia. See Section 7(n) Functions of the ASC Act 1989 and Section 8(d) Powers. (n) to administer and expend money appropriated by the Parliament, or raised in accordance with paragraph (m), for the purposes of the Commission (d) make grants or lend money, and provide scholarships or like benefits; and http://www.legislation.gov.au/Details/C2016C01020 126. It does not mean Sports Minister or Youth and Sports Minister, or Infrastructure Minister or Minister for Health, or Minister for Home Affairs or any other Minister. It does not even mean the Prime Minister. It means Finance Minister. 127. This is because the Finance Minister is potentially best equipped to attend to those pesky details of fiscal budgets, spreadsheets that are not colour-coded for marginal seats, but is charged with producing unadorned facts and figures and soliciting financial reports from those receiving funds appropriated by Parliament, so that the Finance Minister can report to the Expenditure Review Committee. As would be expected other ministers, would not have the knowledge, the skills, the expertise or the inclination to pour over black and white spreadsheets with nothing but figures on them, spinning away calculating the extent of the surplus So whichever unintended errors in engrossment may have occurred with the interchangeable use of plural and singular and other such errors, only one Minister is earmarked, and that only for financial reporting purposes. Source: Australian Sports Commission Act 1989 (C2016C01020) Current Acts Compilation No 18 (compilation dated 21 October 2016 http://www.legislation.gov.au/Details/C2016C01020

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

128. I first note that the Legislation Act 2003 is due for sunset soon. This will not necessarily strip away the provisions enshrined. There are other interpretative acts applicable and these are included in my annotated list with some pertinent extracts from a selection of possibly relevant provisions in statute or ancillary provisions. 129. Regarding Section 22 of the Public Governance Performance and Accountability Act 2013, I note the use of the term “may” not “should” or “must” The phase “must” leaves discretion to the Finance Minister. This level of discretion vested in a single minister, is not, in my opinion as a concerned voter with seriously compromised trust and confidence in the parliamentary system, is not necessarily in the best interests of the public or in the interests of proper accountability and transparency. These are principles that the electorate at large are entitled to rely upon. They have not been delivered. 130. Public Governance Performance and Accountability Act 2013, (PGPA Act 2013), especially Section 71 - C2017C00269 http://www.legislation.gov.au/Details/C2017C00269 131. I cannot speak for others, but I am aware of general unrest and dissonance in the community as evidenced by copious inputs into the public space in responding to media articles. This matter will not settle in a hurry and needs to be resolved to the satisfaction of the electorate who underwrite the salaries and privileges enjoyed by parliamentarians and need to see value for money. When may we expect this? 132. I suggest that Rules are too important to be left to the discretion of a single parliamentarian, more so when there are implications for diluted accountability within the public service and associated Ministers. 133. As mentioned in a paper authored on behalf of Auditors-General published by the Australasian Council of Auditors-General named “Effective Public Sector Accountability” from which I have extensively cited elsewhere, the Principal (stakeholder) is the Community. It is the Principal that is seeking to hold Parliament and its constituents to account. I quote briefly here. 134. “Participation is often related to accountability, and in representative government where citizens participate in government through the electoral process, public officials are accountable to the electorate.” This excellent paper provides sound advice to the parliamentary system by suggesting that “At the grass roots level, participation implies that government structures are flexible enough to other beneficiaries, and others affected, the opportunity to improve the design and implementation of public programs and projects. The paper also recognises at a different level that the effectiveness of policies and institutions impinging on the State as a whole may require the broad support and co-operation of the major stakeholders.”

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

135. The Principal is placed at the top of the pyramid as the Stakeholder-in- Chief. That Principal is the Community. It is quite pleasing to see this reflected in the chart contained on page 23 of the Explanatory Memorandum for this Bill wherein The People of Australia head the chart in the top level of the pyramid shaded in lilac bearing that label with Federal Parliament sitting below that rung of the pyramid. 136. On that basis, I am emboldened to proffer my view that there has been progressive dilution in accountability and transparency which needs to be fixed. In this particular context, I am unable to see why inclusion of incorporated entities cannot be taken as a given. 137. There have always been reciprocal responsibilities and adoption of the CGRG will not change this, but the Rules and Guidelines are more detailed and more clearly spell out those accountabilities applying a more even hand with this than may be comfortable for any given Finance Minister and the department with which he or she is associated. There is no good reason to provide such a Minister with such extraordinary power as to provide unilateral decision-making on such a crucial issue. If Rules of this calibre are to be waived at the whim of a single Minister without even a requirement to gazette or pass them by parliamentary colleagues in Parliament for preference, then the parliamentary process also becomes compromised and thus further plunges the faith trust and confidence in that process. 138. These Rules and Guidelines provide for clear lines of accountability in justifying administrative decisions made. These principles are already enshrined in the Public Service Act 1999, but are given further voice within these Rules and Guidelines, requiring Ministers and their Departments to abide by the Public Service Act 1999 by providing reasoned and credible justification for decisions made. 139. Incorporated entities are already imposed with accountability under several provisions and do have their accounts audited so that they may comply with financial reporting requirements as recipients of capital and operating expenditure costs where this applies and the flow of funds in and out of special accounts established for grant administration. 140. In reciprocation, the Finance Minister, whose department forms policies that the Minister may endorse, or develop his own, if discretion permits, and which are jointly responsible for administering the Commonwealth Grant Rules and Guidelines. 141. I suggest that it would be a good idea to ensure consistency in grant administration policy formation such that there are no residual markets that are left uncovered by such guidelines.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

142. The Auditor-General’s Report upholds the desirability of having consistent and effective rules in place, which recommendation makes sense if the rules and guidelines can be seen as an implementation plan. These should not be allowed at whim to be removed from application without just cause. There is already a precedent in including non- government non-corporate Commonwealth entities within the CGRG guidelines, so there is no credible reason to exclude incorporated Commonwealth entities. One of the key reasons for the involvement of the Auditor-General’s Office in auditing Sports Australia was the absence of application of the CGRG to Sports Australia. I am therefore confident that at a personal level there are sound reasons to reinstate the CGRG to all Commonwealth entities, whilst also recognising that there are multiple requirements for accountability, that no Minister or other parliamentarian should be exempt from accountability and scrutiny and that the public has been waiting a long time for some evidence of proper accountability and transparency. I discuss this further in sections below 143. I suggest that Rules are too important to be left to the discretion of a single parliamentarian, more so when there are implications for diluted accountability within the public service and associated Ministers. 144. I have discussed my rationale for this elsewhere also including my Section 3 Recommendations. 145. The Sports grants saga has attracted wide and sustained attention by media and public alike but it is merely illustrative of altitudinal barriers and lack of political will to be accountable and transparent in the context of representation and governance. The same principle applies in all other circumstances where the original intent of parliament has become diluted and compromised. I discuss the elusiveness of parliamentary intent in other places, including in a small section mentioning some international authors who have a special interest in statutory legislative design principles. Daniel Greenberg as a member of the Commonwealth Assembly of Legislative Counsel is one of these. He discusses the frustrations of trying to discover the intent of Parliament in the context of examining ancient UK Law. The principles still apply. Please see my Recommendations at my Section 3.10 and further commentary at my Section 5. My discussion of Commonwealth Grant Administration is shown at 3.9. 146. By carving out the Commonwealth Grant Rules and Guidelines from application to incorporated entities, the Finance Minister has unquestionably diluted Ministerial accountability by the Minister, who administers the Public Governance Performance and Accountability Act 2013.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

147. This is a matter that came up when the Auditor-General and his staff concluded a 10-month audit into Sports Australia at the time that the Minister for Sport became involved in running a parallel merits assessment scheme which seemed to be more about the merits of providing sports grant cash allocations from funds appropriated by Parliament from the Finance Department to marginal seats reflecting political bias as noted by the Auditor-General in the ANOA Audit Report dated 15 February 2020 which was tabled in Parliament and made public. 148. “8. The design of the program was deficient in a number of important areas. A positive aspect was that the program guidelines were well structured and included clear assessment criteria with transparent weightings. A significant shortcoming was that, while the program guidelines identified that the Minister for Sport would approve CSIG funding, there are no records evidencing that the Minister was advised of the legal basis on which the Minister could undertake an approval role, and it is not evident to the ANAO what the legal authority was.” http://www.anao.gov.au/work/performance-audit/award-funding-under- the-community-sport-infrastructure-program Award of Funding under the Community Sport Infrastructure Program (CSIG) 6.1.1 Views of ANOA on absence of evidence of legal authority for Sports Minister to intervene Conclusion (ANOA Audit Report 15 January 2020 Sports Australia

7. The award of grant funding was not informed by an appropriate assessment process and sound advice.

149. In discussing program design the ANOA report observed the following in relation to legal authority:

13. Program guidelines were developed and published. While the guidelines identified the Minister in an approval role, there are no records that evidence that the Department of Health (Health) or Sport Australia advised the Minister on the legal basis on which the Minister could undertake an approval role. It is not evident to the ANAO what the legal authority was.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

6.1.2 Views of Professor of Constitutional Law, Professor Anne Twomey, University of Sydney on legal authority discretion and unlawfulness Twomey, Anne (2020) (ABC) Ministers like Bridget McKenzie have no discretion to break the rules 20200202 http://www.abc.net.au/news/2020-02-02/bridget-mckenzie-sport-grants- minister-rules/11922152 150. “Ministers have discretion in directing their departments, but do not have the same ministerial discretion in directing corporate entities such as Sport Australia. Ministers keep saying in relation to the sports rorts affairs that Bridget McKenzie had ministerial discretion to make grants and that she was only exercising normal ministerial powers. They also keep saying that no rules were broken. This either shows a complete misunderstanding of the powers of ministers within the legal system, or a desire to mislead the media and the public. 151. “If we were being charitable to Senator McKenzie (and every out minister spouting about ministerial discretion) we could say she as confused and really thought the same rules applied to making these sports grants as would normally apply in relation to a departmental grant program. Perhaps somehow she was not informed that she had only limited legal powers in relation to Sports Australia, despite it point this out. But even if this was so, she must still have known and believed she was subject to the following constraints. 152. “… Minister would have to comply with the Commonwealth Grants Rules and Guidelines, which are imposed by a statutory instrument. They require that Ministers must not approve grants without first receiving written advice from officials on the merits of the proposed grants and must record, in writing, the basis for their approval, relative to the grant guidelines and the principle of achieving value for money. While Ministers may approve grants that are not recommended by officials, they must report to the Finance Minister on all such instances, including a statement of reasons, such as the basis of approval for each grant. 153. “There was no ministerial discretion that could be exercised. The relationship between the Minister and Sport Australia was defined by statute. There was no power for the Minister to act as a delegate for it. She had a limited power to instruct Sport Australia, but her instructions had to be in writing and, for transparency reasons, published in the Gazette and Parliament. She made no such instructions. If she had no power to approve the grants, she was not acting within the scope of the law.” (Direct citations from Prof Anne Twomey, Constitutional Law University of Sydney, article in ABC Opinion 2 February 2020 http://www.abc.net.au/news/2020-01-28/sport-australia-complained-pre- election-government-grants/11905250

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

154. I now include Professor Twomey’s views conveyed in a video broadcast that was embedded within a different ABC article relating to the objections made by Sports Australia in connection with perceived interference in their grants assessment and allocation responsibilities as dictated by statute, conferring that responsibility upon that incorporated authority which is governed by its own establishment enactment under the Australian Sports Commission Act 1989. In that video interview, Professor of Constitutional Law, Anne Twomey went further than she had in the 2 February article cited above in clarifying her interpretation of constitutional law and other matters relating to sports grants administration which raise the issue of the limitations placed on the Commonwealth through the Constitution of Australia. Administrative law considerations apply in relation to any public service department that may be overseen by a Minister. Before providing the details of the interview. 155. I note that incorporated Commonwealth entities like Sports Australia enjoy wider scope and independence than may be the case within public sector entities governed under the Public Service Act 1901. In this regard in the sports grants administration matter the PM and the then Sports Minister appear to have misinterpreted legal authority and discretion thought to be within the ambit of the Sports Minister in usurping the grants scheme assessment and grant allocation. 156. I am surprised that despite Anne Twomey’s views being made public to the rest of the media, the public at large and potentially interested parliamentarians if they access ABC articles at all, and given that many see the ABC as something of any enemy instead of public friend and given that the instigation of government raids have been made on the ABC and on the home of a particular journalist who works for NewsCorp were unjustified and sought through intimidation to suppress democracy principles and accessibility to frankly reported news and opinion, thus eroding the contribution made by the media which I have referred to as The Fourth Estate as a matter of courtesy. 157. Anne Twomey, Professor of Constitutional Law at University of Sydney ABC Video There’s a problem supporting this program” cited in ABC article Probyn, Andrew, 2020) “Sport Australia complained about political interference in this Government’s sports grants program. 2 February 2020 in which an embedded link redirects to an ABC Interview conducted on 29 January 20202 I provide both links 158. Anne Twomey, Professor of Constitutional Law at University of Sydney ABC Video There’s a problem supporting this program cited in: 159. http://www.abc.net.au/news/2020-01-21/minister-did-not-have-legal- power-in-sports-grants/11885142

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

160. Probyn, Andrew (2020) ABC Sport Australia complained about political interference in this Government’s sports grants program 20200129 http://www.abc.net.au.news/2020-01-28/sport-australia-complained-pre- election-government-grants/11905250 161. The agency charged with administering the scandal-plagued sports grant scheme warned the Morrison Government that its interference in the $100 million program was compromising its independence. http://www.abc.net.au.news/2020-01-28/sport-australia-complained-pre- election-government-grants/11905250 162. Last retrieved on 15 February 2020 and viewed from ABC Report “Sports Australia complained about political interference in Government’s sports grants program. Exclusive story by Andrew Probyn ABC Political Editor 163. Twomey, Professor Anne There’s a problem with supporting this program” Video interview 29 January 2020 164. VIDEO: 'There's a problem supporting this program,' Anne Twomey says (ABC News) http//www.abc.net.au/news/2020-01-21/minister-did-not-have-legal- power-in-sports-grants/11885142 http://www.abc.net.au/news/2020-02-02/bridget-mckenzie-sport-grants- minister-rules/11922152? 165. Last retrieved on 15 February 2002 and viewed from ABC Report “Sports Australia complained about political interference in Government’s sports grants program. Exclusive story by Andrew Probyn ABC Political Editor 20200129 166. “Well the Commonwealth is only given very limited powers under the Constitution. There is no power given to it in relation to sport and you might remember the case that Ron Williams brought in relation to challenging the chaplaincy Scheme. In those cases the court said, well the government can’t spend money on things unless there is parliamentary authorisation and unless there is some support in the Constitution for it.” 167. In this particular case the Commonwealth might rely on what is sometimes called its nationhood power, but that means you need some kind of national emergency like the bushfires or the global economic crisis. Resurfacing an oval is not really a national emergency, or it has to be something that peculiarly only the Commonwealth can do and the States are unable to do, and we know that the States can and do give out sports grants. So it does not fit either of those, so it means there is a bit of a problem in terms of supporting this program.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

168. Reporter: Well the Auditor-General did not really go into that. It made some criticisms about the program but said that overall Sports Australia’s position was sound, and the program was sound. What he did question was the legality of the Minister getting involved in the allocation of the funds. What do you make of that and whether or not there is a case to answer there; 169. Prof Twomey: “That’s the second area that might be unlawful and that is that the Minister herself does not have the power to make these decisions in relation to these grants, that is a power that has been vested in Sports Australia as the Australian Sports Commission, and that means there are some difficulties there in terms of working out how it is that the Minister could make the final decision in relation to these grants, so the grants themselves may well be unlawful.”

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

8 Limited annotated list of legislative and other provisions relied upon 1. Acts Interpretation Act 1901 (C2019C00028) Current Latest Version http://www.legislation.gov.au/Details/C2019C00028 Extract: Construction of Acts to be subject to Constitution Every Act shall be read and construed subject to the Constitution, and so as not to exceed the legislative power of the Commonwealth, to the intent that where any enactment thereof would, but for this section, have been construed as being in excess of that power, it shall nevertheless be a valid enactment to the extent to which it is not in excess of that power. 2. Administrative Decisions (Judicial Review) Act 1977 No 59 of 1977 Compilation 111 3 October 2019 http://www.legislation.gov.au/Details/C2019C00309 3. Administrative Appeals Tribunal Act 1975 No 91, 1975 Compilation 46 11 May 2011 http://www.legislation.gov.au/Details/C2018C00172\ 3.1. I note that administrative law provides for due process and full reasoned justification of administrative decision-making. Neither parliamentarians nor public servants are exempt from this. Certain other enactments additionally reflect those requirements I it is my contention that due process was not followed in respect of ministerial involvement or ministerial staff in the grant administration saga under consideration 4. Auditor General Audit Report Sports Australia 15 January 2020 http://www.anao.gov.au/work/performance-audit/award-funding-under- the-community-sport-infrastructure-program Award of Funding under the Community Sport Infrastructure Program Selected Extracts: 4.1. “Was there any evidence of distribution bias in the award of grant funding? 4.2. “There was evidence of distribution bias in the award of grant funding. Overall statistics indicate that the award of funding was consistent with the population of eligible applications received by state/territory, but was not consistent with the assessed merit of applications. The award of funding reflected the approach documented by the Minister’s Office of focusing on ‘marginal’ electorates held by the Coalition as well as those electorates held by other parties or independent members that were to be ‘targeted’ by the Coalition at the 2019 Election. Applications from projects located in those electorates were more successful in being awarded funding than if funding was allocated on the basis of merit assessed against the published program guidelines.”

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4.3. I accept this opinion notwithstanding the refutations made by the Secretary to the Department of Secretary and Cabinet in the 6-page submission made by Phil Gaetjens who also claims significant material divergence from the findings and opinions proffered in the ANOA report dated 15 January 2020 4.4. Triggering factors for ANOA investigation “4. The decision to undertake the audit followed a request from the Shadow Attorney-General, the Hon Mark Dreyfus QC MP, for an audit into the circumstances surrounding the Liberal candidate for Mayo’s presentation of a cheque to the Yankalilla Bowling Club for a project that received $127,373 in funding under the second round. The key rationale for undertaking an audit was that Sport Australia (as a corporate Commonwealth entity) is not subject to the Commonwealth Grant Rules and Guidelines (CGRGs) when administering its grant programs.” 4.5. Was the Minister appropriately advised in writing on the merits of applications against the published criteria? “Appropriate advice on the assessed overall merits of each eligible application was provided by Sport Australia to the Minister. The assessment score clearly indicated the extent to which the Sport Australia assessment team, the assessment panel and Sport Australia board considered each eligible application had met the published criteria. Information on applications being assessed was requested and provided to the Minister’s Office before the assessment process had been completed. Information on applications was provided to the Minister’s Office on four occasions before the assessment process had been completed. Sport Australia provided a list of 2054 applications that had been received, excluding those that had (at that point in time) been assessed as ineligible (applications had closed less than two weeks earlier 5. Auditor General Act 1997 (C2016C01020) Current Acts No 151, 1997 Compilation No 17 21 February 2018 http://www.legislation.gov.au/Details/C2018C00036 6. Australian Electoral Commission (AEC) 7. The AEC as a commonwealth regulator is responsible for all matters relating to elections, including pre-election processes. The limitations of the AEC Act ambit may exclude jurisdiction under some of the matters I raise in relation to sports grants administration and ambit, which relate to the proper legal authority conferred by statute under the enactment applicable to Commonwealth incorporated entities,(which entities do not fall under the description of the “public service sector”) Public Governance Performance and Accountability Act 2013 on the Australian Sports Commission, since 2018 badged as Sports Australia.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

8. It may well be that some of the conduct issues addressed in this submission have implications for the AEC’s ambit of responsibility since fiscal funds allocated by the Finance Minister for allocation of sports infrastructure grants appear to have been appropriated not for the public good of ‘proper purposes’ as defined under the Public Governance Performance and Accountability Act 2013, but rather for political purposes in the pre-election lead-up to the 2019 general election, albeit that the funds were given to sports facilities in the 2018-2019 Sports Grants Infrastructure Scheme allocations (check name\ 9. Australian Sports Commission Act 1989 (C2016C01020) Current Acts http://www.legislation.gov.au/Details/C2016C01020 9.1. Section 3 Interpretation In this Act, unless the contrary intention appears: appointed member means a member other than the Secretary of the Department. 9.1.1. My notation: The only Minister referred to is the Finance Minister. Therefore all references to Department here and elsewhere are taken to mean Department of Finance, not Department of Sport or Department of Infrastructure of Department of Health or any other Department. The Department of Finance through the Finance Minister administers the Public Governance Performance and Accountability Act 2013 which is the primary legislation impacting on all commonwealth incorporated entities. The Australian Sports Commission badged as Sports Australia is not part of the public service. There are different legal authority, discretion reportability and accountabilities applicable to commonwealth incorporated entities than for public sector departments or other agencies. The distinction is crucial as different statutory provisions apply. 9.1.2. It would have been helpful if the Interpretation in this act had clarified under “appointed member” precisely which Department was intended, which cannot surely be anything other than Finance Department. Ministers such as Ministers for Sport do not have the same powers and legal authority over incorporated entities such as Sports Australia as they may have over public sector departments. 9.1.3. Legislative drafting requires precision and specificity in the use of ordinary language or legal terminology. Since the interpretation sections of any enactment are crucial, the starting point for clarification is there. Where in the remainder of the provision clarity vanishes because of inconsistent use of terminology or failure to refine clarification, the opportunity arises for instance to make anything at all of terms such as “Department” “relevant Department” or “The Minister” or “A Minister” These are not even specialised legal terms, but ordinary words in which the use of pronouns carelessly can give rise to misinterpretation. If the intent is to refer to the Finance Minister, that is the complete term that should be employed.

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9.1.4. The interpretation begins with “appointed member” and then refers to “the Department” Which department would that be?” Incorporated entities are not integral to the public sector and are not public sector departments. That is why they are legally structured so as to be accountable under corporations law under the Corporations Act 2001, and for governance and performance and other accountability under the Public Governance Performance and Accountability Act 2013 administered by the Finance Minister 9.1.5. Creeping careless in drafting gives rise to creeping misinterpretation of the intent of Parliament. This undermines the authority and credibility of Parliament and its process. These look like small insignificant issues, but they are not. The intent of Parliament is not clarified or maintained by careless use of language 9.1.6. Such matters of the misinterpretation of terms can give rise to unlawful conduct. It is bad enough when misinterpretation occurs when clarity and precision is provided within an enactment, but if language usage contributes to misinterpretation the outcomes can be serious and give rise to expensive debate including in arbitrated proceedings if they result 10. Commonwealth Grants Rules and Guidelines http://www.finance.gov.au/government/commonwealth- grants/commonwealth-grants-rules-guidelines 11. Purpose Commonwealth Grant Rules and Guidelines 2017 11.1. The Commonwealth Grants Rules and Guidelines 2017 (CGRGs) are issued by the Finance Minister under section 105C of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). 11.2. For convenience of access, given that the Purpose of the Commonwealth Grant Rules and Guidelines 2017 begins with citing 105C of the Public Governance Performance and Accountability Act 2013, I provide below that Section from the PGPA Act 2013, which relates to Rules in relation to Consolidated Revenue Fund (CRF). It seems that the discretion lies within the Rules, since the Section may allow the CRF to be appropriated for the purposes of the expenditure of other CRF by a person other than the Commonwealth subject to the 105 3(a) and (b) 11.3. If it is not feasible to adopt the existing CGRGs for incorporated then the ANOA suggestion that a similar set of rules and guidelines be created that will offer the same reciprocal rights and obligations 11.4. Section 105 Rules in relation to other CRF money (PGPA Act 2013 Definition of CRF within the Act: CRF (short for Consolidated Revenue Fund) means the Consolidated Revenue Fund referred to in section 81 of the Constitution. (1) The rules may prescribe matters in relation to other CRF money. (2) Other CRF money is money that forms part of the CRF other than: (a) relevant money; or

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(b) any other money of a kind prescribed by the rules. (3) The CRF is appropriated for the purposes of the expenditure of other CRF money by a person other than the Commonwealth if: (a) the expenditure is in accordance with any requirements prescribed by the rules; and (b) the Finance Minister is satisfied that the expenditure is not authorised by another appropriation. 11.5. Next the same sentence in the CGRGs refer to the Constitution Section 81 in particular. I provide this as well as Section 82 and 83. Section 81 merely says that “all moneys raised by the Executive Government shall one consolidated Revenue Fund to be appropriated for the purposes of the Commonwealth in the manner and subject to the charges and liabilities imposed by this Constitution 11.6. Section 82 says that “No money shall be drawn from the Treasury of the Commonwealth except under appropriation made by law. 11.7. Therefore all money spent must be through statute. The funds allocated have to go through the Expenditure Review Committee, so presumably the $1 million appropriated for block grant allocation to Sports Australia for Project 1 of sports grants allocations and Project 2 (female water sports infrastructure) in the sum of a further $1.5 million would have had to go through that Committee and be approved under statute. Several parties would have known about the need to target marginal seats, and the opportunity arose to use funds appropriated for the purpose of securing merit assessment of grant application and cash allocations was used for the purpose of touting for votes in a political biased partisan attempt to use leverage by targeting marginal seats 11.8. Commonwealth of Australia Constitution Act http://www.legislation.gov.au/Details/C2013Q00005 Chapter IV—Finance and Trade

81 Consolidated Revenue Fund All revenues or moneys raised or received by the Executive Government of the Commonwealth shall form one Consolidated Revenue Fund, to be appropriated for the purposes of the Commonwealth in the manner and subject to the charges and liabilities imposed by this Constitution.

12. Government Procurement (Judicial Review) Act 2018 No 129, 2018, C2018A00 http://www.legislation.gov.au/Details/C2018A00

13. Senate Public Governance and Accountability Committee 14. Public Accounts and Audit Committee 15. http://www.legislation.gov.au/Details/C2017C00109

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16. National Integrity (Parliamentary Standards) Bill 2019 (Senate) (Senator Waters 16.1. (Senator Waters â—‚¬—€œ AG 16.2. The bill: provides for statutory codes of conduct for the members of each house of parliament and their staff; creates a statutory basis for parliamentarians' registers of interests; establishes a Parliamentary Integrity Advisor to provide independent, confidential advice and guidance to parliamentarians and their staff in relation to the applicable codes of conduct; and establishes a Parliamentary Standards Commissioner to assist in the assessment, investigation and resolution of alleged breaches of the applicable codes of conduct 16.3. This Bill has great potential to set the bar higher for standards generally and accountability and transparency in particular I have prepared some recommendations and responses as a late submission if acceptable. I would like to see the proposed Parliamentary Integrity Adviser and Parliamentary Standards Commissioner combining enforcement roles with proactive education and guidance including on challenging legal matters such as correctly interpreting legal authority and discretion, notably in dealing with incorporated non-government entities 16.4. I would like to see the current Statement of Ministerial Standards abolished and in the short term removal of the phrases “considerable privilege and “wide discretion” These are terms with legal meaning and not to be freely banded about. Legal authority is always conferred by statute and may not afford discretion, but discretion is conceptually impotent without legal authority. Self-conferral is unlawful 17. Public Accounts and Audit Committee http://www.legislation.gov.au/Details/C2017C00109 18. Public Governance Performance and Accountability Act 2013, (PGPA Act 2013), especially Section 71 - C2017C00269 http://www.legislation.gov.au/Details/C2017C00269 Extract: Division 9—Special provisions applying to Ministers only 71 Approval of proposed expenditure by a Minister (1) A Minister must not approve a proposed expenditure of relevant money unless the Minister is satisfied, after making reasonable inquiries, that the expenditure would be a proper use of relevant money. (2) If a Minister approves a proposed expenditure of relevant money, the Minister must: (a) record the terms of the approval in writing as soon as practicable after giving the approval; and

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

(b) comply with any other requirements prescribed by the rules in relation to approvals of proposed expenditure. (3) For a Parliamentary Department, the references in subsection (1) or (2) to a Minister are references to: (a) a Presiding Officer, for expenditure for which he or she alone is responsible; and (b) the Presiding Officers jointly, for expenditure for which they are jointly responsible. Further extract: 11 Types of Commonwealth entities There are 2 types of Commonwealth entities: (a) corporate Commonwealth entity, which is a Commonwealth entity that is a body corporate; and (b) a non-corporate Commonwealth entity, which is a Commonwealth entity that is not a body corporate. Note: Corporate Commonwealth entities are legally separate from the Commonwealth, whereas non-corporate Commonwealth entities are part of the Commonwealth. Further extract: 13 Officials (1) Each Commonwealth entity has officials. Officials of Commonwealth entities (other than listed entities) (2) An official of a Commonwealth entity (other than a listed entity) is a person who is in, or forms part of, the entity. (3) Without limiting subsection (2), an official of a Commonwealth entity (other than a listed entity) includes: (a) a person who is, or is a member of, the accountable authority of the entity; or (b) a person who is an officer, employee or member of the entity; or (c) a person, or a person in a class, prescribed by an Act or the rules to be an official of the entity. (4) Despite subsections (2) and (3), each of the following is not an official of a Commonwealth entity (other than a listed entity): (a) a Minister; (b) a judge; (c) a consultant or independent contractor of the entity (other than a consultant or independent contractor of a kind prescribed by an Act or the rules for the purposes of paragraph (3)(c)); (d) a person, or a person in a class, prescribed by an Act or the rules not to be an official of the entity. Officials of listed entities

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

(5) An official of a Commonwealth entity that is a listed entity is a person who is prescribed by an Act or the rules to be an official of the entity. Further extract:

22 Corporate Commonwealth entities (4) The Finance Minister may make an order (a government policy order) that specifies a policy of the Australian Government that is to apply in relation to one or more corporate Commonwealth entities. My comment: 1. I note that the discretion of the Minister for Finance or his associated department of Finance has exercised discretion in extended the Commonwealth Grant Rules and Guidelines to non-government non-incorporated entities but not to incorporated entities. The ANOA has strongly recommended in Recommendation 4 of its Audit of Sports Australia that a similar set of Grant and Rules be established for incorporated entities such as this, which are not part of the public service but fulfil a statutory public duty and deserve to have reciprocal accountability arrangements in place requiring a Minister or public service department to be accountable for decisions and be in a position to provide reasoned justification as in any case would be required under administrative law. 2. I have been unable to identify a good reason to leave this matter unattended other than to escape accountability. Non-government non-corporate entities are already covered so it does seem like splitting hairs. In any case the Secretary to the Department of Prime Minister and Cabinet has confirmed in his submission to this Committee that the recommendation made by the Auditory-General will be met, which presumably means that a replica of the current CGRGs will be put in place to cover incorporated statutory authorities. The CGRGs could do with a re-examination. 3. I have included reference to Division 9 Section 71 of the Public Governance Performance and Accountability Act 2013 which clarifies existing accountabilities though during the entire sports grants saga which remains unresolved the Finance Department apparently argued that the Minister had no requirement at all to account for decisions made in usurping the assessment and grant allocation scheme from a statutory authority conferred with both legal authority under statute to run the scheme without the level of interference that occurred, compromising their ability to meet their obligations including reporting obligations under statute/ If the Prime Minister the rest of the Cabinet and the other parliamentarians believe the this level of unfettered discretion is appropriate when no legal authority exists for ministers other than the Finance Minister in terms of ensuring that the funds appropriated by Parliament for the purpose of providing block grants from the public purpose for a particular reason, which surely does not including exploiting those funds for political gain. There was no doubt in the minds of the ANOA staff that the alternative assessment and decision-making was associated with political bias regardless of the protests made. 4. The term used is “may” not should or “must” This leaves discretion to the Finance Minister. This, in my opinion as a concerned voter with seriously compromised trust and confidence in the parliamentary system, is not necessarily in the best interests of the public or in the interests of proper

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

accountability and transparency. These are principles that the electorate at large are entitled to rely upon. They have not been delivered. I cannot speak for others, but I am aware of general unrest and dissonance in the community as evidenced by copious inputs into the public space in responding to media articles. This matter will not settle in a hurry and needs to be resolved to the satisfaction of the electorate who underwrite the salaries and privileges enjoyed by parliamentarians and need to see value for money. When may we expect this 5. As mentioned in a paper authored on behalf of Auditors-General published by the Australasian Council of Auditors-General named “Effective Public Sector Accountability” from which I have extensively cited elsewhere, the Principal (stakeholder) is the Community. It is the Principal that is seeking to hold Parliament and its constituents to account. I quote briefly here 6. “Participation is often related to accountability, and in representative government where citizens participate in government through the electoral process, public officials are accountable to the electorate.” This excellent paper provides sound advice to the parliamentary system by suggesting that “At the grass roots level, participation implies that government structures are flexible enough to other beneficiaries, and others affected, the opportunity to improve the design and implementation of public programs and projects.” 7. The paper also recognises at a different level that the effectiveness of policies and institutions impinging on the State as a whole may require the broad support and co-operation of the major stakeholders.” The Principal is placed at the top of the pyramid as the Stakeholder-in-Chief. That Principal is the Community. 8. In this particular context, I am unable to see why inclusion of incorporated entities cannot be taken as a given. There have always been reciprocal responsibilities and adoption of the CGRG will not change this, but the Rules and Guidelines are more detailed and more clearly spell out those accountabilities applying a more even hand with this than may be comfortable for any given Finance Minister and the department with which he or she is associated. There is no good reason to provide such a Minister with such extraordinary power as to provide unilateral decision-making on such a crucial issue. If Rules of this calibre are to be waived at the whim of a single Minister, then the parliamentary process also becomes compromised. 9. These Rules and Guidelines provide for lines of accountability in justifying administrative decisions made. These principles are already enshrined in the Public Service Act 1999, but are given further voice within these Rules and Guidelines, requiring Ministers and their Departments to abide by the Public Service Act 1999 by providing reasoned and credible justification for decisions made. 10. Incorporated entities are already imposed with accountability under several provisions and do have their accounts audited so that they may comply with financial reporting requirements as recipients of capital and operating expenditure costs where this applies and the flow of funds in and out of special accounts established for grant administration. 11. In reciprocation, the Finance Minister, whose department forms policies that the Minister may endorse, or develop his own, if discretion permits, and which are jointly responsible for administering the Commonwealth Grant Rules and Guidelines.

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12. I suggest that it would be a good idea to ensure consistency in grant administration policy formation such that there are no residual markets that are left uncovered by such guidelines. 13. The Auditor-General’s Report upholds the desirability of having consistent and effective rules in place, which recommendation makes sense if the rules and guidelines can be seen as an implementation plan. These should not be allowed at whim to be removed from application without just cause. 14. There is already a precedent in including non-government non-corporate Commonwealth entities within the CGRG guidelines, so there is no credible reason to exclude incorporated Commonwealth entities. One of the key reasons for the involvement of the Auditor-General’s Office in auditing Sports Australia was the absence of application of the CGRG to Sports Australia. I am therefore confident that at a personal level there are sound reasons to reinstate the CGRG to all Commonwealth entities, whilst also recognising that there are multiple requirements for accountability, that no Minister or other parliamentarian should be exempt from accountability and scrutiny and that the public has been waiting a long time for some evidence of proper accountability and transparency. 15. I suggest that Rules are too important to be left to the discretion of a single parliamentarian, more so when there are implications for diluted accountability within the public service and associated Ministers. 16. The Sports grants saga has attracted wide and sustained attention by media and public alike but it is merely illustrative of altitudinal barriers and lack of political will to be accountable and transparent in the context of representation and governance. The same principle applies in all other circumstances where the original intent of parliament has become diluted and compromised. I discuss the elusiveness of parliamentary intent in other places, including in a small section mentioning some international authors who have a special interest in statutory legislative design principles. Daniel Greenberg as a member of the Commonwealth Assembly of Legislative Counsel is one of these. He discusses the frustrations of trying to discover the intent of Parliament in the context of examining ancient UK Law. The principles still apply. Please see my Recommendations at my Section 3.10 and further commentary at my Section 5. My discussion of Commonwealth Grant Administration is shown at 3.9. 17. By carving out the Commonwealth Grant Rules and Guidelines from application to incorporated entities, the Finance Minister has unquestionably diluted Ministerial accountability by the Minister, who administers the Public Governance Performance and Accountability Act 2013. 18. This is a matter that came up when the Auditor-General and his staff concluded a 10-month audit into Sports Australia at the time that the Minister for Sport became involved in running a parallel merits assessment scheme which seemed to be more about the merits of providing sports grant cash allocations from funds appropriated by Parliament from the Finance Department to marginal seats reflecting political bias as noted by the Auditor-General in the ANOA Audit Report dated 15 February 2020 which was tabled in Parliament and made public.

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

Further exec tract

Division 2—Accountable authorities Subdivision A—General duties of accountable authorities 15 Duty to govern the Commonwealth entity (1) The accountable authority of a Commonwealth entity must govern the entity in a way that: (a) promotes the proper use and management of public resources for which the authority is responsible; and (b) promotes the achievement of the purposes of the entity; an (c) promotes the financial sustainability of the entity. Note: Section 21 (which is about the application of government policy) affects how this duty applies to accountable authorities of non-corporate Commonwealth entities. (2) In making decisions for the purposes of subsection (1), the accountable authority must take into account the effect of those decisions on public resources generally. Further extracts

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Madeleine Kingston Private Stakeholder 20200217 Submission Select Senate Committee on Sports Grant Administration

15A Duty to establish and maintain systems relating to risk and control The accountable authority of a Commonwealth entity must establish and maintain: (a) an appropriate system of risk oversight and management for the entity; and (b) an appropriate system of internal control for the entity; including by implementing measures directed at ensuring officials of the entity comply with the finance law. Note 1 An example of a measure directed at ensuring officials of the entity comply with the finance law is a measure: (a) requiring, as a condition of employment of an official of the entity, that the official complies with the finance law; and (b) specifying sanctions (such as termination) that apply to the official for contravening that condition. Such a measure would not be needed for officials to whom the Public Service Act 1999 or Parliamentary Service Act 1999 applies because, under that Act, sanctions may be imposed on those officials for contravening the finance law: see section 32 of this Act. Note 2 This duty includes managing consultants and independent contractors who work for the entity, even if they are not officials of the entity.

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