PARLIAMENT OF NEW SOUTH WALES Committee on the Independent Commission Against Corruption REPORT 1/56 – MARCH 2016 REVIEW OF THE 2013-2014 ANNUAL REPORTS OF THE INDEPENDENT COMMISSION AGAINST CORRUPTION AND THE INSPECTOR OF THE INDEPENDENT COMMISSION AGAINST CORRUPTION PARLIAMENT OF NEW SOUTH WALES COMMITTEE ON THE INDEPENDENT COMMISSION AGAINST CORRUPTION REVIEW OF THE 2013-2014 ANNUAL REPORTS OF THE INDEPENDENT COMMISSION AGAINST CORRUPTION AND THE INSPECTOR OF THE INDEPENDENT COMMISSION AGAINST CORRUPTION REPORT 1/56 – MARCH 2016 New South Wales Parliamentary Library cataloguing-in-publication data: New South Wales. Parliament. Committee on the Independent Commission Against Corruption. Review of the 2013-2014 Annual Reports of the Independent Commission Against Corruption and the Inspector of the Independent Commission Against Commission / Joint Committee on the Independent Commission Against Corruption. [Sydney, N.S.W.] : the Committee, 2016. [126] pages ; 30 cm. (Report ; no. 1/56) Chair: Damien Tudehope, MP. “March 2016”. ISBN: 9781921012228 1. New South Wales. Independent Commission Against Corruption. Annual report ; 2013- 2014. 2. Corruption investigation—New South Wales. I. Title. II. Tudehope, Damien. III. Series: New South Wales. Parliament. Committee on the Independent Commission Against Corruption. Report ; no. 1/56. 364.13230994 (DDC22) The motto of the coat of arms for the state of New South Wales is “Orta recens quam pura nites”. It is written in Latin and means “newly risen, how brightly you shine”. REVIEW OF THE 2013-2014 ANNUAL REPORTS OF THE ICAC AND THE INSPECTOR OF THE ICAC Contents Membership ____________________________________________________________ iii Committee’s functions _____________________________________________________iv Chair’s foreword __________________________________________________________ v List of recommendations __________________________________________________ vii COMMENTARY ................................................................................................................................... 1 INTRODUCTION ________________________________________________________ 1 RECENT AMENDMENTS TO THE ICAC ACT ____________________________________ 2 Committee comment _________________________________________________________ 3 THE ICAC _____________________________________________________________ 4 Assessment and investigation processes __________________________________________ 4 General Procedures __________________________________________________________ 4 Committee comment _________________________________________________________ 4 Disclosure of confidential information ___________________________________________ 5 Committee comment _________________________________________________________ 7 Corruption prevention and education functions ____________________________________ 7 Investigations _______________________________________________________________ 8 Sector-wide projects _________________________________________________________ 8 Education __________________________________________________________________ 9 Committee comment ________________________________________________________ 10 Relationship with the Office of the Director of Public Prosecutions ____________________ 10 Committee comment ________________________________________________________ 12 INSPECTOR OF THE ICAC ________________________________________________ 13 Resources and staffing _______________________________________________________ 13 Vacancy period_____________________________________________________________ 13 Committee comment ________________________________________________________ 14 The Inspector’s audit function _________________________________________________ 15 The Telecommunications (Interception and Access) Act 1979 (Cth) ____________________ 16 A new oversight model for Police ______________________________________________ 19 Committee comment ________________________________________________________ 19 Liaison between the Inspector and the ICAC ______________________________________ 20 Committee comment ________________________________________________________ 21 THE COMMITTEE’S OVERSIGHT POWERS ____________________________________ 21 The role of the Committee ____________________________________________________ 21 Legislative provisions ________________________________________________________ 21 National Crime Authority (NCA) model __________________________________________ 22 Accountability framework ____________________________________________________ 23 MARCH 2016 i COMMITTEE ON THE INDEPENDENT COMMISSION AGAINST CORRUPTION The Inspector’s role _________________________________________________________ 25 The 2013-2014 Annual report Review ___________________________________________ 25 The public hearing __________________________________________________________ 25 Committee comment ________________________________________________________ 26 Committee conclusions ______________________________________________________ 28 APPENDIX ONE – TRANSCRIPT OF EVIDENCE ........................................................................ 29 APPENDIX TWO – ICAC’S ANSWERS TO QUESTIONS TAKEN ON NOTICE AND FURTHER QUESTIONS ...................................................................................................................................... 75 APPENDIX THREE – THE INSPECTOR’S ANSWERS TO FURTHER QUESTIONS ................104 APPENDIX FOUR – EXTRACTS FROM MINUTES ...................................................................... 111 ii REPORT 1/56 REVIEW OF THE 2013-2014 ANNUAL REPORTS OF THE ICAC AND THE INSPECTOR OF THE ICAC Membership CHAIR Mr Damien Tudehope MP DEPUTY CHAIR Mr Adam Marshall MP MEMBERS Mr Ron Hoenig MP The Hon Kevin Humphries MP Ms Tania Mihailuk MP Mr Chris Patterson MP Ms Kathy Smith MP Mr Mark Taylor MP The Hon Trevor Khan MLC Revd the Hon Fred Nile MLC The Hon Lynda Voltz MLC CONTACT DETAILS Committee on the Independent Commission Against Corruption Parliament of New South Wales Macquarie Street Sydney NSW 2000 TELEPHONE 02 9230 2214 E-MAIL [email protected] URL www.parliament.nsw.gov.au/icac MARCH 2016 iii COMMITTEE ON THE INDEPENDENT COMMISSION AGAINST CORRUPTION Committee’s functions Under section 64 of the Independent Commission Against Corruption Act 1988, the functions of the Committee are to: • monitor and review the exercise by the ICAC and the Inspector of the ICAC of their functions • report to Parliament, with such comments as it thinks fit, on any matter appertaining to the ICAC or the Inspector or connected with the exercise of its functions to which, in the Committee’s opinion, the attention of Parliament should be directed • examine each annual and other report of the ICAC and the Inspector and report to Parliament on any matter appearing in, or arising out of, any such report • examine trends and changes in corrupt conduct, and practices and methods relating to corrupt conduct, and report to Parliament any change which the Committee thinks desirable to the functions, structures and procedures of the Commission and the Inspector • inquire into any question in connection with its functions which is referred to it by both Houses of Parliament, and report to both Houses on that question. Nothing in the ICAC Act authorises the Committee to: • investigate a matter relating to particular conduct • reconsider a decision to investigate, not to investigate or to discontinue investigation of a particular complaint • reconsider the findings, recommendations, determinations or other decisions of the ICAC in relation to a particular investigation or complaint. iv REPORT 1/56 REVIEW OF THE 2013-2014 ANNUAL REPORTS OF THE ICAC AND THE INSPECTOR OF THE ICAC Chair’s foreword The 2013-14 Annual Reports of the Independent Commission Against Corruption (ICAC) and the Inspector of the ICAC were reviewed by the Joint Committee on the ICAC on 7th August 2015. The hearing by the oversight committee was conducted against the noise created by the manner in which the ICAC investigated certain allegations concerning Senior Crown Prosecutor, Margaret Cunneen and styled ‘Operation Hale’. A good deal of time was spent in the committee proceedings seeking to elicit responses as to the manner in which the ICAC went about the conduct of its investigation of the Senior Crown Prosecutor. The ICAC Commissioner sought to deflect a significant number of those questions by relying on Section 64(2) of the Independent Commission Against Corruption Act 1988. At the conclusion of the committee hearing, the Committee sought advice from the Crown Solicitor as to the interpretation of Section 64(2). The Crown Solicitor’s advice was provided to the Clerk of the Legislative Assembly. That advice remains the property of the Clerk and is not generally available for publication. It is fair to say however, that the advice canvassed the extent to which the Committee can question the ICAC in respect of operational activities. In summary, the advice of the Crown Solicitor indicated that the Committee is entitled to ask questions relating to particular conduct or investigations where the questions are for the purpose of reviewing the way in which the ICAC conducts its functions, and its investigation and decision-making procedures. This does not mean that the Committee can reconsider the substance of individual matters investigated by the ICAC, with a view to substituting its own decision. Oversight of bodies such as the ICAC is an essential component of the manner in which the