Putting an end to jobs for mates in Australian politics

Jobs for mates – it’s frustrating when it happens in everyday life. Even more so when it happens at the highest levels of politics. A plum job as Trade Commissioner for a former Deputy Premier. A spot on the Administrative Appeals Tribunal for a former staffer.

State and federal governments make hundreds of appointments each year to public boards and tribunals – and many of them go to people with political connections.

While it may seem harmless – after all, ‘everyone does it’ – it can have pervasive consequences for Australia’s democracy.

Listen to Danielle Wood, CEO, Kate Griffiths, Deputy Program Director, Anika Stobart, Associate, and Kat Clay, Head of Digital Communications, discuss Grattan’s latest report New politics: A better process for public appointments.

Transcript

Kat Clay: Jobs for mates. It’s frustrating when it happens in everyday life, even more so when it happens at the highest levels of politics. A plum job as trade commissioner for a former deputy premier. A spot on the administrative appeals tribunal for a former staffer. State and federal governments make hundreds of appointments each year to public boards and tribunals, and many of them go to people with political connections.

And while it might seem harmless, after all, everyone does it, it can have pervasive consequences for Australia’s democracy. I’m Cat Clay, and here to discuss Grattan’s latest report, New Politics, A Better Process for Public Appointments, are Grattan’s CEO, Danielle Wood, and her co-authors, Kate Griffiths and Anika Stobart, from Grattan’s Budgets and Government team. So, Dani, starting with you, we often hear reports in the media of plum government jobs going to political mates, but how big a problem is this?

Danielle Wood: Look, it very much is a problem and, and it is a lot more widespread than, than people might think. So, we all know that the headline grabbing examples, you mentioned the New York Trade Commissioner gig for former New South Wales Deputy Premier John Barilaro in your introduction there.

We see it. we know it smells, it offends people’s sense of fairness, you know, and it certainly offends our expectations that, that governments are going to be focused on the public interests when they’re making decisions. rather than party interest or personal interest. But what we’ve done in this new report is, is really try and answer that question of how widespread this is, you know, what is happening for all the ones that aren’t making the headlines?

and what we found is that. You know, there’s hundreds of these appointments each year made across the federal government. the proportion of those with a direct political connection is about seven percent. but this includes a whole lot of sort of more technical committees that are, they’re mainly filled by experts.

So if we just restrict it to looking at the public appointments that are well paid, that are prestigious, that are powerful, you know, the ones that are probably going to be most attractive to a former politician or advisor, Then we see 21 percent more than one in five have a direct political connection overwhelmingly, with the coalition, which was the government that appointed them, you know, this is not just a coalition issues is not just a federal government concern.

We did a similar exercise looking at a Victoria and we found that it was still more than 10 percent of appointees in this case, overwhelmingly with Labor connections appointed by the Victorian Labor government. So, the evidence that we’ve built up here. You know, it certainly leads us to conclude that we do have a problem with politicization of appointments in Australia, at least for some governments, and that is important enough to warrant better checks and balances.

Kat Clay: I mean, we’ll dig into those numbers in a second, but Kate, I mean, what type of jobs are we talking about here?

Kate Griffiths: Yeah. So, each year, federal and state governments make appointments to the boards of government businesses, regulatory and economic agencies, tribunals. and cultural institutions. And these appointments are usually decided by the relevant minister and then kind of formalized by the governor general.

At the federal level, we’re talking about a pool of about 3, 600 public roles, which include appointments to the productivity commission, to the ABC board, to the war memorial board, for example. and many of these roles, as Danny said, are powerful, they’re prestigious, they’re well paid. They’d include some of the major businesses that a government owns, such as Australia Post.

The NBN, Sydney Water, and these are businesses that employ thousands of people and manage income in the billions. So, they matter, they’re big, and these roles are important. And the other thing I’d note is that many of these jobs, or many of these bodies are supposed to be independent at arm’s length from government.

That’s how they’re set up. And so, in the case of the Administrative Appeals Tribunal, for example, the role of the body is to review government decisions, independence is therefore critical to what they do.

Kat Clay: And we will talk about the AAT in a minute, but Dani mentioned that many of these jobs go to political mates.

Anika, how did you determine who was political?

Anika Stobart: It was a really big exercise actually going through, all of the appointments that governments have made as, Danny said there’s been thousands of them. So, what we did was is we took a very clear definition of how we define someone as political, or not.

So, what we counted was someone who is or has worked in politics as a politician, candidate, a political advisor, or an employee of a party. So that means we didn’t count members of political parties, prominent supporters, union officials, or friends. And we found these types of political affiliations can be difficult to consistently identify.

That’s why we kept them out, but essentially that means what we, unearth in our analysis is actually just a flaw of politicization.

Kat Clay: So, I mean, this is just a start because that’s what you wanted to be consistent about and I think that’s, that’s quite a shocking statistic already, but to think that that’s just the flaw is, is mind boggling.

Kate, you mentioned the AAT, are they the worst offenders? What else is going on here?

Kate Griffiths: So, in many ways, the AAT is probably the worst offender, because in that case we’re talking about a tribunal of 320 current members, 70 of whom have a direct political connection. So that’s, they were a former politician, they were a former staffer, or they were a former party official, as Anika has said.

Of those 70, 64 are connected to the political party that appointed them. So, they’re coming from the same side of politics, as the appointing government, just for, to kind of put it in perspective, we’re talking about 20 percent of members, to that body, one in five. That’s incredible, especially for a body that is supposed to scrutinize government decisions.

But there are other stark examples too. So perhaps some of the other offenders that really stand out, the government business boards, and that’s across all states. So, we’re not just talking about federal, level appointments here. These are high paying positions, and in most jurisdictions, we see that at least one in ten members have political connections.

That’s well above the rate of political connections you would see, on ASX100 boards, for example, which is less than two percent. And some of the individual boards amongst the government businesses, are particularly, stark, such as Australia Post, where half of all the members of that board have a direct political connection.

We did look at a range of other powerful boards and a range of other prestigious boards and a few jump out, the Productivity Commission, half of current appointees to the Productivity Commission and the Commonwealth Grants Commission as well have political connections to the government that appointed them.

And the story was similar at state level for many of the powerful boards too. Among the prestigious boards, people probably would have heard of the War Memorial, the Australian Sports Commission, the Sydney Harbour Trust, the Maritime Museum, the National Library. Some of these sorts of appointments, we see that all of them in fact have at least a third of board members with a direct political connection.

So, they were some of the examples that really stood out to us and, sort of put in perspective that this is much more widespread than perhaps just the headline grabbing occasional ones that Danny pointed out at the beginning.

Kat Clay: And I mean the jaded among us might think, well, you know, what does that really matter?

but I think if we dig into that example of the administrative. I think we see why that’s important. So just for our listeners, and I mean for myself, because I had never heard of it before reading this report. What does it actually do? And I kind of want to establish why it’s significant, what makes it such a plum job and why the political appointments influential here.

Kate Griffiths: Absolutely. Yeah. So why is it a plum job? Look, the AAT is the trifecta. It is powerful, it is prestigious, and it is well paid to give listeners a sense of just how well paid we’re talking full time members can earn almost 200, 000 up to almost 500, 000 a year. In terms of how powerful it is, it’s making consequential judgments on administrative law appeals, and to put that in context, we’re talking about, members of the public can ask the AAT to review a government decision that affects them, say on child support or on migration status, and the AAT will, will form a judgment.

And so, it’s critical that the AAT that in that making that judgment is independent, because that’s what’s required to uphold public trust and confidence in that decision, and also to provide real access to justice and government accountability at the end of the day. So, the AAT matters, and we can see on the AAT It’s not just a big body that has one in five members with political connections.

It’s also a body where we can see the politicization has been growing over time. When we looked back in the 2000s and early 2010s, just 3 percent of new members had political connections to the appointing government. But in the past five years, it’s almost a third of new appointments. And many of these appointments were made on election eve.

So, in the final days before the caretaker period commenced, in the lead up to the 2019 and 2022 federal elections, we saw a flock of announcements for new appointments. And it’s, it’s this that, that really has the potential to sort of undermine this institution and trust in government more broadly.

Kat Clay: Yeah, that was one of the most striking facts to come out of your report.

just the coincidental timing between elections and appointments. Dani, I’m playing devil’s advocate here. Surely just because someone has a political connection doesn’t mean they’ll do a bad job.

Danielle Wood: And look, no, it doesn’t mean they’ll do a bad job. You know, some of them will be meritorious and, and do a very good job.

But what we’re really saying here is look at the pattern, look at the number of them. look at the fact that they’re almost exclusively connected to the party that appoints them. Look at the fact that we have a system where most of these appointments are made without going through any sort of proper process.

That pattern means that you’re certainly increasing the chances that, that the people are in these roles that are not up to the job. There’s international literature on this, that kind of looks at the risks when you have a lot of politicized appointments. We can see that it can undermine the performance of those organizations.

It can undermine the integrity of those organizations. If you have too many people that are there, because they know the right people rather than being the right person for the role. So, if we look at the Administrative Appeals Tribunal that we’ve just been talking about, there is some evidence there that those with political connections are performing worse than, than the other members.

So almost a quarter of appointees that have political connections are under their performance targets compared to 17 percent of non-political appointees.

Kat Clay: And I believe I remember from the report too that political appointees have longer terms of tenure than non-political appointees as well.

Danielle Wood: That’s right.

So, we, we discovered that they’re more likely to be appointed for longer periods. They’re less likely to have legal qualifications than people that don’t have political history. So, you know, there’s a number of indicators there that, that point to causes for concern.

Kat Clay: So, Dani, I mean, overall, what are the costs then to having a high number of political appointments to our democracy?

Danielle Wood: It matters for a number of reasons, Kat. I mean, the first one, the one is essentially we’ve just been talking about, you know, you can miss out on the best people to run these, these key roles. Institutions, you know, as Kate said, these are important roles that they’re making regulatory decisions. They’re reviewing government decisions.

They’re overseeing important cultural institutions. They matter. So, we want the best person for the job. You know, most Australians go through selection processes when they get their jobs, you know, to be a builder or a nurse or a computer programmer, you go through a selection process. You’re chosen on merit and, you know, I think they would expect the same for these really important roles, that effectively they’re paying for.

The second risk is that you run the risk that the decisions of these organizations become politicized or at least perceived to be politicized. So, this can be, there’s been allegations, for example, of politically skewed exhibitions at the war memorial. Which as Kate said is a, one of the boards where there is a lot of people with political connections.

But you know, at the other end of the spectrum, it could be really worrying for an organization like the Administrative Appeals Tribunal. Because it is adjudicating on appeals of government decisions. You run the risk that people make decisions in a way that favours. the political party that appointed them, or at least are perceived to be.

And what that does is undermine faith in that institution. And that’s why we’ve had, organizations like the Law Council, you know, really calling this out as a key risk. The third issue might be a little bit less obvious to people, but it’s the culture that it creates. And we talk about it in the report as a culture of patronage, where it creates an incentive for people to sort of Toe the line with the government of the day.

So, this could be, you know, outstanding people in the community, that would like to fill one of these positions. You know, the message that they hear is really, you know, don’t do anything that will upset the government. It might be an existing minister or advisor that thinking. This could be a nice job for me after my political career.

They won’t want to do anything to, to rock the boat. And former CEO John Daly wrote about this in his gridlock report as actually a potential impediment to policy reform. Why take a chance on doing something that’s in the long-term national interest but might be in the short term unpopular if it’s going to put you offside with, with colleagues and cut off your post politics career choices.

So, there are all sorts of insidious. impacts that this can have. But I think just over time, it just chips away at public trust in the sense that government is acting in the national interest. and, and that is sort of damaging for democracy, as you said in the question.

Kat Clay: So, Kate at Grattan, we’re not just about problems. We’re also about practical solutions. How would you fix this?

Kate Griffiths: Currently public appointments are usually made behind closed doors. with no independent oversight, and that creates a suspicion that these jobs go to mates, even when someone with political connections might actually be the best candidate for the job.

So, we would say that Australia needs greater transparency and oversight of its public appointment system to build that public confidence that governments are appointing the best candidates, whether they’ve got political connections or not. What we recommend in our report is that federal and state governments, as well adopt a more transparent merit-based process for a start.

All appointments and selection criteria advertised, and independent panel assesses applicants against the selection criteria and provides a short list of suitable candidates to the minister. The minister can then choose from the short list. Or if they don’t like the shortlist, they can redefine the selection criteria.

But what they can’t do is make a captain’s pick from outside the shortlist. So that’s where we’re putting guardrails, I guess, around ministerial discretion. We also recommend establishing a public appointments commissioner, because this is an important role that would oversee the whole process, would sit on the independent panel and would report to parliament.

And that’s the oversight we’re currently missing in the system.

Kat Clay: That seems like a very radical reform, just following the normal job procedure that most of us follow in our everyday lives. It shouldn’t be that hard, should it? No, and I think that’s what I like so much about this report. What it’s proposing is straightforward and I would say relatively easy to implement.

Kate, would an Integrity Commission prevent the politicization of public appointments here?

Kate Griffiths: In the public eye, the Integrity Commission, that, that has been promised at the federal level this year, and already exists in, in most states is seen to be kind of the answer to a lot of integrity problems and, and certainly where they exist.

These sorts of commissions can be a really important deterrent and a last line of defence for investigating the most egregious conduct, but they’re not the main vehicle to reduce politicization of public appointments. We really need better processes in place upfront that are legislated because that’s what will prevent the politicization from happening in the first place.

It shouldn’t get to the Integrity Commission essentially. So, we hope that the recommendations in this report, along with our next two reports on pork barrelling and on taxpayer funded advertising, will help lay the foundations for a new way of doing politics in Australia that safeguards the public interest over political interests.

Kat Clay: Thank you so much, Dani, Kate and Anika. I love this report and if you would like to read this report, it’s available for free on our website at grattan.edu.au. Grattan Institute is a not-for-profit organization, and we do rely on donations from our lovely listeners like you. If you’d like to donate, please go to grattan.edu.au/donate. We really appreciate it. If you’d like to talk to us more about political appointments on Twitter, we’re at grattaninst and on all other social media channels, Grattan Institute. As always, please take care and thanks so much for listening.