State to state, lobbying for change

As national and local media turned its attention to the worsening COVID-19 outbreak that started in Sydney’s eastern suburbs this past month, few outlets devoted ink or airtime to a major announcement that came out of that city’s inner-western suburbs.

On June 22, the NSW anti-corruption watchdog handed down the findings of an 18-month investigation into government lobbying, colourfully titled Operation Eclipse.

Intended as a follow-up to Operation Halifax, the Independent Commission Against Corruption’s 2010 investigation into the lobbying of public officials, Operation Eclipse borrowed several significant characteristics, from its predecessor, most notable that the investigation was not concerned with uncovering any alleged incidents of corruption.

Instead, ICAC chief commissioner Peter Hall sought to assess the broad risk of corruption involved with lobbying state government officials and offer recommendations of significant reform to the state’s regulation of lobbying.

If implemented, the report’s findings and recommendations would constitute a significant expansion in how NSW regulates lobbying, including increased reporting requirements for in-house lobbyists and a broader definition of what constitutes lobbying of state government officials.

Such regulation would give NSW the nation’s tightest control over lobbying, a claim once made by Western Australia when, amid lobbying scandals that engulfed WA Labor’s parliamentary ranks 15 years ago, then premier Alan Carpenter introduced a ministerial code of conduct and publicly available lobbyist register.

No other state or territory kept a publicly available list of lobbyists when WA’s register was introduced in 2007, with Mr Carpenter’s stated intent to put clear onus on lobbyists to declare their interests when meeting with state government officials.

Sharyn O'Neill, the state’s public sector commissioner, oversees the register, and is given wide purview to refuse applications by prospective lobbyists as well as remove any from the register based on conduct that either contravenes the ministerial code or is deemed inconsistent with general ethical standards.

The list, which requires quarterly updates at minimum, provides a thorough view of the state’s lobbyists, from well-known former MLAs such as Carol Martin, Katie Hodson-Thomas, and Megan Anwyl, through to the top end of town’s lobbyists of choice, including Minderoo Foundation, which is a client of Newgate Communications, and Wesfarmers, a client of DPG Advisory.

Mr Carpenter’s championing of the register, alongside his attempts to purge Brian Burke’s influence within WA Labor’s parliamentary ranks, has largely had the intended effect of increasing transparency and reporting requirements for third-party lobbyists in the state.

Still, in the time since WA introduced its register and code of conduct, several other states have taken bigger steps towards improving ministerial accountability and implemented stricter reporting standards.

Queensland’s lobbyist register, for instance, provides details of each lobbyist’s term of employment, history prior to becoming a lobbyist and relevant associations to other organisations, as well as details of current and former clients, and whether they paid for lobbying services or received them pro bono.

That is in addition to a publicly available contact log, which lists the details of meetings held between public officials and lobbyists, alongside a declaration of compliance with the relevant code of conduct.

Victoria’s register, meanwhile, requires lobbyists to disclose whether they worked as a political adviser or party operative prior to lobbying, while NSW’s register indicates whether a firm has an active, suspended, or ineligible licence to lobby, alongside explanatory notes.

And while Mr Hall’s report for ICAC made note of deficiencies in NSW’s lobbying laws, the Corruption and Crime Commission, WA’s counterpart to ICAC, has spent significantly less time on the practice, having conducted only a handful of targeted investigations over the past decade.

There are clear reasons for this, not least that WA has had no major lobbying scandals since the register was introduced.

NSW, conversely, introduced similar requirements in 2011 amid an ICAC investigation that engulfed then premier Bob Carr, who was acquitted for his involvement in a zoning dispute with Westfield Group, and election pledges from Liberal premier Barry O’Farrell to increase transparency in the profession.

Lobbying itself is also not an inherently corrupt process, with Martin Drum, senior lecturer in politics and international relations at The University of Notre Dame Australia, calling it a normal part of representative democracy.

However, he explained that the process can become problematic when undue influence in the form of incentives or threats are directly tied to outcomes sought by a lobbyist.

That extends to lobbyists who involve themselves in political fundraising, as their promise of campaign dollars may act as an incentive for representatives to reach desired policy outcomes.

“Given that historically there have been plenty of instances of this, it is no wonder that lobbying can have a negative connotation,” Professor Drum said.

Daniel Smith, founder and executive director of CGM Communications, said lobbying had developed a negative reputation in part due to its scale and influence within US politics.

He noted that WA’s own history of lobbying scandals was likely a contributing factor in why the profession locally carries negative connotations, with the term itself now codified into legislation.

“The term ‘lobbyist’ implies massive pressure is brought to bear,” Mr Smith said.

“It doesn’t work like that; most of the work we do is in the strategic space.

“We work with our clients to identify what they want to achieve; we identify how that aligns with what the government wants to achieve and what is in the interest of the state or country.

“It’s far more complex and multifaceted than ‘lobbying’ implies.”

FTI Communications managing director Cameron Morse similarly said the term continued to have negative connotations due to its association with the scandals that pushed Mr Carpenter to introduce tougher regulation of the profession.

Mr Morse also made a distinction in how his firm undertook lobbying, arguing its government advocacy work did not fall strictly into the purview of lobbying as broadly understood.

“There is a distinction between lobbying on someone’s behalf, compared to how we assist clients with government relations, whereby our client is actively involved in all communications with government,” Mr Morse told Business News.

“It’s our view that our clients, with our direction and advice on how best to communicate to government effectively, are best placed to prosecute their own arguments or policy positions.”

While many were broadly supportive of the existing regulation, some criticism was reserved for the remit of the existing register, which requires the likes of ACT-based firms TG Endeavour and DPG Advisory to declare a long list of clients that may not be relevant to WA.

Conversely, lobbying as defined in the Act is narrower than in some other states and territories, with representatives of industry bodies, trade unions and charities not required to list their names, clients or employers with the commission’s register, despite being known to seek concessions and policy outcomes from stakeholders.

This was a known feature of the register, with Mr Carpenter explicitly stating the state’s code of conduct and register of lobbyists would apply only to third-party lobbyists when it was introduced in 2007.

Professor Drum noted that the register only regulates third-party lobbyists, with little transparency around the practice of businesses directly hiring in-house lobbyists.

This is important, as ICAC’s own investigation into lobbying found that, in NSW, third-party lobbyists were subject to the strictest regulations despite carrying out what it describes as a fraction of lobbying in that state.

“They’re the sort of loopholes and grey areas that can be tightened up,” Peter Kennedy, political journalist and Political Perspective columnist, said.

“Why wouldn’t [companies] list their government relations department people?

“If it is government relations, how much different is that to lobbying?”

“They are there to deal with government and obviously represent the company’s best interests.”

While the recommendations tossed up by ICAC may make for interesting discussion, appetite for major reform in WA appears slim across government and industry.

As part of this story, Business News asked Premier Mark McGowan’s office if the state government would consider supporting the introduction in WA of a handful of major recommendations made by ICAC.

They included the creation of an official lobbying commissioner, and obligations for ministers to maintain and disclose records of all meetings and communications with lobbyists.

Business News separately contacted all 17 state government ministers to ask them whether they kept a record of all in-person meetings and electronic communications with registered lobbyists, and that, if said records existed, they were available in an accessible, digital format.

All questions addressed to ministers were, in turn, directed back to the premier’s office, with a spokesperson for the state government telling Business News that ministers are required to keep a register of all contact with lobbyists in keeping with relevant legislation.

“Each office is required to maintain their own register of contacts with lobbyists, and complete and retain a ‘dealing with lobbyist form’ for each engagement,” the spokesperson said.

“This also includes the ministers themselves.

“The Act and the complementing lobbyists code of conduct sets out standards that ensure lobbyists inform government representatives that they are registered lobbyists, who their clients are and the nature of their issues.

“Additionally, the Public Sector Commissioner’s instruction 16 requires all public sector employees to only have dealings with registered lobbyists.

“Before a meeting, a lobbyist must disclose that they are a registered lobbyist, who their client is, and the nature of their issue.

“These measures ensure that, before any discussions occur between lobbyists and members of parliament or public sector employees, there is clear understanding of who lobbyists represent.

“The Department of the Premier and Cabinet encourages ministers, parliamentary secretaries and ministerial officers to record communications with lobbyists.”

Amanda Reid, partner and company secretary at GRA Partners, told Business News that WA’s system was robust in regulating the interaction of lobbyists with government representatives.

Ms Reid also pointed out the existence of the Australian Professional Government Relations Association, of which GRA is a founding member, as a way for lobbyists to maintain high standards through its own code of conduct.

“The formation of APGRA was a direct response by our member businesses, all of which have a long track record assisting clients in navigating government and regulatory issues, to a shift in community and public standards towards greater accountability and transparency around lobbying and regulatory advice,” Ms Reid said.

“Membership of the association is open to all practitioners provided they are able to satisfy and commit to our code of conduct and membership rules.

“We believe public affairs practitioners need to be leaders in establishing higher standards, just as we believe public affairs practitioners provide an essential service helping corporate and non-government organisations to interact with the public sector.

“Lobbying is a legitimate and important part of the democratic process of government.”