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Senate Standing Committee - Report - 50th - Possible improper interference with a witness and possible false or misleading answers given to the Senate or a Senate committee - Report, December 1994


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THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

THE SENATE

COMMITTEE OF PRIVILEGES

Possible Improper Interference with a Witness and Possible False or Misleading Answers given to the Senate or a Senate Committee

50th Report

December 1994

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

THE SENATE

COMMITTEE OF PRIVILEGES

Possible Improper Interference with a Witness and Possible False or Misleading Answers given to the Senate or a Senate Committee

50th Report

December 1994

© Parliament of the Commonwealth of Australia 1994

ISSN 1038-9867 ISBN 0 642 22402 1

This document was produced from camera-ready copy prepared by the Committee o f Privileges, and printed by the Senate Printing Unit, Parliament House, Canberra.

MEMBERS OF THE COMMITTEE

Senator Baden Teague (Chairman) (South Australia) Senator the Honourable Margaret Reynolds (Deputy Chairperson) (Queensland) Senator Bruce Childs (New South Wales) Senator John Coates (Tasmania)

Senator Christopher Ellison (Western Australia) Senator Jim McKiernan (Western Australia) Senator Bob Woods (New South Wales)

The Senate Parliament House CANBERRA ACT 2600

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CONTENTS

Page

CHAPTER 1 - INTRODUCTION AND BACKGROUND 1

Introduction 1

Structure of report 2

Background 3

(a) Reference to Joint Committee of Public Accounts 3

(b) The Midford Case 4

(c) Customs responses to questions in the Senate and estimates committees 6

Conduct of inquiry 7

Customs culture 9

CHAPTER 2 - POSSIBLE FALSE OR MISLEADING EVIDENCE 13

Introduction 13

Background 13

(a) The administrative penalties scheme of the Australian Customs Service 13

(b) Mr Richardson's first encounter with triple dipping 16

Committee's methodology in determining whether false or misleading answers were given to the Senate or a committee 18

CHAPTER 3 - POSSIBLE THREAT OR INJURY 23

Introduction 23

The telephone threat 23

Alleged consequences of the threat 24

Was the threat made? 25

Was the threat carried out? 29

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CHAPTER 4 - MISCELLANEOUS MATTERS 33

Introduction 33

Alleged derogatory remarks about Mr Richardson 33

(a) By Comptroller-General 33

(b) By Mr John Drury, National Manager, ACS Import-Export Control Subprogram 36

(c) By other Customs officers 37

Other claims 38

General conclusions 38

CHAPTER 5 - OBSERVATIONS, FINDINGS AND RECOMMENDATIONS 41

The Customs culture revisited 41

Consequences for whistleblowers 43

Findings 45

Recommendations 46

APPENDIX - Letter dated 15 September 1994 from Ms Lesley Lyons

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CHAPTER 1

INTRODUCTION AND BACKGROUND

Introduction

1.1 On 20 May 1993, the following matters were referred to the Committee of Privileges on the motion of Senator Watson:

(1) Having regard to the letter of 13 May 1993 to the President from the Joint Committee of Public Accounts, whether there was any improper interference with Mr John Richardson as a witness, and, if so, whether any contempt was committed.

(2) Having regard to the submissions made to the Senate on 25 February and 4 May 1992, whether any false or misleading answers were given to the Senate or a Senate committee, and, if so, whether any contempt was committed.

1.2 The first of these two references was initiated by the Joint Committee of Public Accounts (JCPA), which drew to the attention of the President a claim by Mr John Richardson that he had received an anonymous telephone call on 17 April 1991, threatening that:

"If you say anything bad about Customs or some officers we will put you out of business and make it so bad for you within your industry, you'll be unemployable." [JCPA Hansard, 29 August 1991, p. 288]

1.3 The alleged threat related to an inquiry about the Australian Customs Service ("ACS" or "Customs"), referred to the JCPA by the Senate in December 1990. The case came to be known as the "Midford case". The alleged telephone call was thus made four months after the reference, but well before that

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committee's first public hearings, which were held on 8 August 1991. Mr Richardson gave evidence on a range of matters before the JCPA at a public hearing on 29 August 1991, and reported the threat in the course of that hearing. The JCPA has given an account of the alleged threat, indicating its serious concern, at paragraphs 25.13 to 25.21 of its report into the Midford matter, entitled The Midford Paramount Case and Related Matters [JCPA Report 325, Parliamentary Paper No. 491/1992]. In that same report (para 24.15,

p. 386) the JCPA gave notice of its intention to report the matter to the Senate.

1.4 The second matter arose from detailed submissions by Mr Richardson tabled in the Senate on 25 February and 4 May 1992, concerning evidence given to Senate Estimates Committee A and answers given in the Senate, or in response to questions on notice, by ACS officers and by the then minister as

advised by those officers, primarily concerning the administrative penalties scheme under the Customs Act.

1.5 While the references, and the possible contempts, involved different considerations for the Committee, it has considered the matters together in view of the one person being affected. The Committee also noted that, if the second set of allegations were proved, it could be indicative that the threat the subject of the first reference had in fact been carried out. It is the claim of Mr Richardson that Customs officers pursued him in respect of the administrative penalties matter so that ultimately he was driven out of his profession, thereby ensuring that the threat was fulfilled.

Structure of report

1.6 This first chapter gives the background to the references, outlines the Committee's conduct of its inquiry and suggests the context in which difficulties confronting Mr Richardson might have arisen. Before dealing with the alleged threat, which is the subject of the first reference, the Committee decided that the question of false or misleading evidence should be first examined, because it explains the broad context within which the alleged threat was made. Accordingly, Chapter 2 analyses the allegations contained in the two documents tabled in the Senate and referred to the Committee. The third chapter deals with the alleged threat and the possible consequences

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of that threat having been made. Chapter 4 examines matters, arising in the course of the Committee's inquiry, which do not fit readily within either term of reference. The final chapter reports the Committee's observations, findings and recommendations, and expands upon matters raised in general terms in

Chapter 1.

Background

(a) Reference to Joint Committee of Public Accounts

1.7 The first of these references, as indicated, derived from the following reference of 5 December 1990 to the Joint Committee of Public Accounts:

That the following matters be referred to the Joint Parliamentary Committee of Public Accounts for inquiry and report by 15 May 1991:

(a) the cost to the Commonwealth, amounting to more than $lm, of the actions of the Department of Industry, Technology and Commerce and the Australian Customs Service in fulfilling their

administrative responsibilities in the handling of the failed prosecution of Midford Paramount Pty Ltd;

(b) the methods of operation of the Australian Customs Service in preparation and conduct of prosecutions and settlements and, in particular, their actions throughout the preparation, prosecution and settlement of the Midford

Paramount Pty Ltd case, including the reasons for the Director of Public Prosecutions' discontinuance of the prosecution;

(c) the practice, propriety and method of the

Australian Customs Service of gathering evidence for prosecutions and dealing with the public in the course of such investigations;

(d) the actions of the Minister for Industry,

Technology and Commerce and successive Ministers responsible for Customs in addressing the propriety of administrative actions within the

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Industry, Technology and Commerce portfolio and the Australian Customs Service, in particular; and

(e) the need for effective definition of the lines of ministerial control of the Australian Customs Service and, in particular, the actions of the Minister for Industry, Technology and Commerce in oversighting successive Ministers responsible for Customs in relation to the operations of the Australian Customs Service.

[Journals of the Senate, p. 508]

(b) The Midford Case

1.8 The case before the JCPA involved Midford Paramount Pty Ltd, an Australian shirt manufacturer which had operated successfully for more than 40 years. Full details are set out in the JCPA report (see especially Chapter 2), but the following briefly summarises the Midford matter.

1.9 On 3 December 1987 ACS officers entered Midford's premises and removed a quantity of documents. On 15 June 1988 Midford directors and their tariff adviser were charged under the Crimes Act with alleged misuse of import quotas, allegedly involving a fraud of $4.5 million on the Commonwealth. The charges were subsequently withdrawn, on 30 June 1989, following the discovery of significant flaws in the prosecution case during the committal hearing.

1.10 After the withdrawal of charges concerning quotas, Customs forwarded to the Director of Public Prosecutions (DPP) a brief requesting that charges be laid against Midford and others concerning alleged financial irregularities in respect of what is known in the import business as "financial accommodation". This matter had been under investigation since 1987 but had lost precedence to the quota charges. After initial advice from the DPP that a prima facie case existed on the financial accommodation matter it was decided in September

1989 that charges would not be laid.

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1.11 In addition to this legal action, in late 1987 and early 1988 ACS had impounded a large amount of Midford's stock and revoked its import quotas. These actions made it virtually impossible for Midford to trade in a profitable manner and on 1 August 1990 the business was sold.

1.12 At the time that the ACS entered the Midford premises, 3 December 1987, Mr Richardson was an employee of L J Miles & Associates, a firm of customs agents which represented Midford Paramount. Mr Richardson had been employed by the company since 1983. On 7 December 1987 the ACS obtained

documents concerning Midford's import quotas from Miles & Associates. On 10 December Customs cancelled Midford's quotas. The following day Mr Richardson rang Customs to explain that Midford had done nothing illegal and that the disputed importation of shirts was covered by a special

government agreement [JCPA Report, paras 5.1 - 5.6],

1.13 On 3 February 1988 Customs officers asked Mr Richardson to sign a statement they had prepared concerning the Midford case. He refused to sign the document prepared by ACS but provided a statement he wrote himself. Mr Richardson believed Midford had not acted in contravention of the law

and made his views known to the ACS and the Minister's office [JCPA Report, p. 46 and Hansard, pp. 352-53]. Mr Richardson was nonetheless scheduled to appear as a Customs witness in the Midford case but did not give evidence as the case was withdrawn before he was due to be called.

1.14 It is worth observing that, if Customs had taken notice of the information provided to it by Mr Richardson, that is, that Midford had authority to import the goods which were the subject of the prosecution, the matter might well have ended there, but the prosecution case ignored the existence of the

agreement and consequently foundered when the defence produced copies at the committal hearing [JCPA Hansard, p. 1746],

1.15 On 8 February 1990 the magistrate who heard the charges in 1989 awarded costs to the defendants and made a number of strong criticisms of those responsible for the preparation of the prosecution case. These events led to questions being raised in estimates committee hearings, and culminated in the

December 1990 reference to the JCPA.

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1.16 In the event, the JCPA discovered such a complex web of operations, involving claim and counter-claim between Customs and the former owners, tariff adviser and customs agent of the company affected, that it was unable to report on the reference until December 1992. In its report, the JCPA was scathing of the operations of the ACS, and recommended that compensation be paid to all relevant persons, including Mr Richardson.

1.17 In November 1993, nearly three years after the matter was referred to the JCPA and six years after the matters which were the subject of the inquiry were initiated, compensation of nearly $25m was paid to the persons identified by the JCPA as affected by the actions of Customs. Mr Richardson was awarded nearly $ l1 /2m. It may be noted that the JCPA concluded specifically in respect of Mr Richardson that he had "suffered both personally and financially as a result of the Midford Case" [JCPA Report, para 24.15, p. 386].

(c) Customs responses to questions in the Senate and estimates committees

1.18 During the entire period that the JCPA was examining the Midford matter, and the administration of the Australian Customs Service generally, Mr Richardson was also in dispute with Customs about the administration of the administrative penalties scheme, which had come into operation on

1 July 1989, the day after the charges against Midford had been withdrawn. An account of the scheme, and of its importance to Mr Richardson, is given in Chapter 2. In brief, Mr Richardson was so concerned about its operation, and about information being provided by Customs officers to the Senate and,

in particular, to Senate estimates committees, that he compiled and forwarded to the Senate two substantial documents setting forth a series of detailed allegations that the ACS had misled the Senate [Letters from John Richardson with attached submissions dated 17 and 19 February 1992, and 30 April 1992]. The then

President of the Senate tabled both documents in the Senate, in February and May 1992, and the question whether any false or misleading evidence had been given to the Senate or its Committees was referred to the Committee of Privileges in May 1993, at the same time as the alleged threat was referred.

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Conduct of inquiry

1.19 The tasks confronting the JCPA in reaching its conclusions on the Midford case are well described in its report. So far as the Privileges Committee's terms of reference are concerned, one indication of its task is that some 25000 pages of documentation have been examined. In this regard, the Committee

wishes to pay particular tribute to Mr Wayne Hooper, Principal Research Officer to the Committee, who undertook extensive evaluation, ordering and cross-checking of the documentation, and prepared the analyses of the material on which much of the Committee's deliberation was based. The purpose of undertaking such detailed work was to refine the broad terms of reference to establish whether any contempt might be involved in either of the matters referred to the Committee, and if so whether it was possible to

ascertain who might have been responsible.

1.20 The complexity of this task is best demonstrated by the fact that the Committee has been undertaking the reference since May 1993, which constitutes a record for its deliberations: a record which it is not anxious to challenge in any case in the future. As the Senate is aware, the Committee

places the highest priority on the resolution of any question of possible interference with a witness and therefore undertakes such inquiries with as much vigour and expedition as possible. In the particular circumstances of this case, however, the delays have been unavoidable.

1.21 As is its practice in matters such as these, the Committee wrote to Mr John Richardson and to the Comptroller-General of Customs seeking submissions on both terms of reference. It also wrote to the JCPA, seeking all relevant documentation, and, in particular, seeking the approval of the JCPA to publish any documents which, whether received as in camera material or as

exhibits, had not been authorised for publication, but which the Committee of Privileges might consider necessary to publish for the purposes of its inquiry. The JCPA gave the Privileges Committee access to all the material necessary, with the identities of certain persons obliterated, and indicated

that it would be willing for any essential material to be published.

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1.22 In the event, given the limited nature of the actual questions of contempt on which the Committee has been required to make findings, it has been able to preserve the confidentiality of the documents made available to it. The Committee has therefore received the documentation provided by the JCPA as in camera evidence, and does not propose to release that evidence unless otherwise ordered by the Senate. In addition, the Committee does not intend, unless ordered by the Senate, to release its own documentation, on which the

findings which it now reports to the Senate are based, to ensure that the information given to it by the JCPA is not compromised.

1.23 The documents to which the Committee refers in this report are those provided by Mr John Richardson and by his wife, Ms Lesley Lyons, in response to the Committee's invitation to make submissions; the submission of the former Comptroller-General of Customs, Mr Frank Kelly, also in response to the Committee's invitation; a submission by Mr Peter Bennett, President of the Customs Officers Association; and other documents which are on the public record.

1.24 As will be clear from the report, the Committee was assisted by the Richardson/Lyons submissions; cross-checking with JCPA documentation was required only as an independent verification of the information provided. Unfortunately, the Committee was not greatly assisted by the submission from the then Comptroller-General of Customs, which did not address with any precision specific issues which the Committee was required to determine, particularly in relation to term of reference (2), although the Committee

found several attachments to the submission of great assistance in reaching its conclusions. The Committee did not perceive the need to seek further information from Mr Kelly, or from the ACS, as it was able to satisfy itself on the information otherwise available as to what had actually occurred.

1.25 The Committee gave serious consideration to the need to hold public hearings on the matter. The privilege resolutions of 25 February 1988 provide that the opportunity must be given to any persons who may be the subject of adverse findings and wish to take the opportunity to do so to put their views forward at committee hearings, under the special protections provided by privilege resolution 2. In addition, the Committee itself has on some occasions found the need to hold public hearings as part of its investigatory processes. It was

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under the latter circumstances that the Committee considered whether there was a requirement to test documentary evidence by oral evidence.

1.26 In some ways, such an approach would have been of assistance to the Committee. It was, however, mindful of the state of health of the complainant in this matter. Obviously, if the Committee had regarded it as imperative to reach conclusions or make findings adverse to the Australian Customs Service

on the two questions of contempt, the question of Mr Richardson's health would have been overridden by the right of the ACS and its officers to the fair hearing required by the privilege resolutions. On the other hand, given the conclusions of the JCPA that Mr Richardson's health and prospects of

employment had been seriously affects by ACS behaviour, and later advice, through Mr Richardson's wife, of his doctors' views that resurrecting the matters would be seriously detrimental to his health, the Committee concluded that this should be avoided if possible.

1.27 The Committee took particular account of a letter from Ms Lyons, dated 15 September 1994, on which more detailed comments will be made in the last chapter of this report, drawing its attention to comments made in the Report of the Senate Select Committee on Public Interest Whistleblowing, In

the Public Interest, tabled in the Senate on 31 August 1994 [Parliamentary Paper No. 148/94], and to an article by Dr Jean Lennane, published in the British

Medical Journal [Vol. 307, 11 September 1993, pp. 667-70], on psychological and medical consequences for whistleblowers. Consequently, the Committee has proceeded, as in most of its previous cases, on the basis of written material only.

Customs culture

1.28 Before proceeding to the Committee's analysis of and observations and findings on the matters referred to it, the Committee considered that it would be useful to place the matters before it in the context of what several external scrutineers, including the Committee itself [see 46th Report, March 1994, paragraph

2.19, Parliamentary Paper No. 43/1994], have described as the "Customs culture".

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1.29 The Australian Customs Service has throughout the past decade or so been the subject of a quite extraordinary array of inquiries by a range of parliamentary and non-parliamentary bodies. The Committee has noted from Appendix D to the JCPA Report [pp. 519-523] that since 1975 special inquiries have been conducted by the Administrative Review Council, management consultants, interdepartmental committees, task forces, the Auditor-General, senior public servants and academics, the Australian Law Reform Commission and the House of Representatives Standing Committee on Finance and Public Administration.

1.30 In addition to these inquiries, which were specifically directed to the ACS, the Committee has had access to worrying general comments included in reports of administrative scrutineers such as the Ombudsman (see, for example, Annual Report 1989-90) and the President of the Administrative Appeals

Tribunal (see Reasons for Judgement in Collector of Customs v LNC (Wholesale) Pty Ltd of 21 November 1989), quoted in the Ombudsman's Report. Similarly, the Law Council of Australia, in evidence given to the House of Representatives Standing Committee on Finance and Public Administration, drew attention to a culture of defensiveness and resistance

to change. Customs has also received the normal and consistent critical scrutiny to which all Commonwealth bodies are subject from committees such as Senate estimates committees, and from the Auditor-General.

1.31 The two most significant inquiries, which have had the most direct influence on the restructuring of the Australian Customs Service, have undoubtedly been the JCPA Midford Inquiry which, as noted at paragraph 1.2 above, has precipitated the first question the Privileges Committee has been required to examine, and the review of the Australian Customs Service conducted by Mr Frank Conroy (Chairman), the Hon. Ian Macphee, AO and the Hon. Susan Ryan, AO. That review, which was established as a result of the JCPA inquiry, was completed in December 1993 and tabled by the Minister responsible for Customs, Senator the Hon. Chris Schacht, on 8 February 1994

[Journals of the Senate, p. 1215], It was as scathing of the Australian Customs

Service as the JCPA had been, and recommended wide-ranging restructuring.

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1.32 This Committee in its 46th Report, presented to the Senate a month after the Conroy review was tabled, expressed the hope that the recommendations of the review would be swiftly implemented so that problems consistently identified within the Service would be overcome. The Privileges Committee's

report was also critical of the performance of ACS senior management before Estimates Committee E, and the Committee has had some reason to be concerned at the reaction of officers to its 46th report during their most recent appearance before the Economics Legislation Committee. In respect of

this present reference the Committee reaches similar conclusions regarding the quality of ACS evidence before Estimates Committee A in the years 1990 to 1992.

1.33 The most succinct expression of concern about the ACS culture was provided in submissions both to the Midford Inquiry and to the Committee of Privileges by the Customs Officers' Association, a long-established employee organisation, which, while no longer a registered industrial organisation, is

an association to which some Customs officers still belong. An extract from the submission by Mr Peter Bennett, President of the Association, to the JCPA [JCPA S1302-S1310] summarises complaints raised before and by all external evaluators of the ACS performance. In his submission, Mr Bennett

made the following observations: 1

1. Constant reviews of the ACS have caused a siege mentality in the Service. 2. The ACS is constantly reorganising to create the illusion of development. 3. Despite some worthwhile advances the ACS is always in

catch-up mode in trying to stay ahead of the next review. 4. The Committee should consider the matters of this inquiry simply as symptoms of the basic structural problems facing Customs.

5. The Customs culture has developed into an entity which has its own agenda. Criticisms are not tolerated. The "system" demands compliance. 6. The fundamental contradiction in Customs is its dual

roles of CONTROL and FACILITATION. 7. As Customs cannot carry out its functions very

effectively, isn't it reasonable to give some other structure or system a try? What could we lose? [JCPA S1310]

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1.34 Two further recommendations specific to the Midford inquiry follow, and Mr Bennett's submission then concludes:

10. Given the excessive criticism of the ACS by various parties, the Committee might question why ACS management think there is nothing wrong with the system or structure. 11. An Inspector General of Customs acting as a standing

audit system would seem to be a better alternative than continual reviews. [ibid., S1310]

1.35 This Committee's only comment is in respect of Mr Bennett's first observation. While recognising that a multiplicity of inquiries can contribute to the development of a siege mentality, the Committee has no doubt that Customs had developed a managerial culture which attracted the attention of external reviewers, culminating in the JCPA Midford report and the resultant Conroy review. That the ACS had resisted change for such a long time before action was taken following the Midford report is a matter of grave concern but gives an explanation of the reasons why this Committee has been required to consider these latest two matters under its contempt powers. This culture of defensiveness also gives an explanation of the conclusions that the Committee of Privileges has reached in both matters.

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CHAPTER 2

POSSIBLE FALSE OR MISLEADING EVIDENCE

Introduction

2.1 Although the first matter referred to the Committee, and as previously indicated the matter of most serious concern to it, involves the alleged threat to Mr Richardson, in order to deal coherently with both matters this chapter discusses the second matter referred - the question of false or misleading

evidence.

Background

2.2 Mr Richardson produced two documents, both tabled in the Senate, in which he set out detailed claims that false or misleading evidence was given to the Senate and, particularly, Estimates Committee A, in respect of the administrative penalties scheme under the Customs Act.

(a) The administrative penalties scheme of the Australian Customs Service

2.3 On 10 July 1989, Mr Richardson moved from Sydney to Adelaide to take up a position as a Customs agent with a new employer, International Freight Forwarding Pty Ltd. Ten days earlier, amendments to the Customs Act concerning administrative penalties for making false statements came into

force. Briefly, these amendments: provided that it was an offence to give false information in a customs entry (import documentation); specified the penalties for breaches; and prescribed the procedures and criteria for remission of the penalties (sections 243T, 243U and 243V).

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2.4 Since 1986 ACS has operated a fast-track import entry processing system. Under this system entry documents completed by importers or their customs agents are directed down either a "green line" or a "red line". The House of Representatives Standing Committee on Finance and Public Administration, in its report entitled A Tour o f Duty, tabled on 16 May 1991 [Parliamentary Paper No. 114/1991], described the system as follows:

Under the red/green system . . . 90 per cent of entries are considered low risk and speedily processed down a 'green line', within four hours. The assumption is that the documentation supplied and duty self-assessed by the importer are correct. The remaining entries are termed 'red line' and are directed to an Audit Bay or to another area for further examination.

[Report, p. 20]

2.5 The Law Reform Commission (LRC) expanded on the description as follows:

. .. The importer must give the Australian Customs Service .. . all the relevant information about the goods, including the identification and classification of the goods for the purpose of the Customs Tariff, and the customs value of the goods, in an entry. The importer must also state the amount of duty payable. Customs examines the supporting documentation only if the entry is selected for the redline. This may be because, on the basis of research, analysis and investigation, a transaction has been identified as a high risk transaction, or it may be random.

. . . High error rate. Following the introduction of full self assessment, there was a perception that there was a high rate of error in entries. In June 1987 the Auditor-General reported that as many as 90% of entries checked contained an error and that most errors favoured the importer.

[Law Reform Commission, Report No 61, Administrative Penalties in Customs and Excise, September 1992, p. 2]

2.6 When the self-assessment provisions were introduced, the legislation did not provide for a penalty for duty short-paid. All that Customs could do when an importer or agent understated the duty payable was to demand that the proper amount be paid. As result there was no incentive to take care in the

completion of entry documents. The 1989 amendments, which introduced the administrative penalties scheme, were intended to remedy this situation. The

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Minister for Industry, Technology and Commerce, Senator Button, when introducing the amending Bill, quoted figures suggesting that there was a shortfall in duty of $26 million directly attributable to agent or importer error.

2.7 The Law Reform Commission outlined the rationale of this refinement in the following terms:

When it was introduced, the administrative penalty scheme was justified on the basis that it was necessary to deter 'playing the green line odds'. The odds were said to favour the importer because only 10% of entries were checked and, in the absence of

evidence of fraud, there were no effective penalties for error. The scheme was advanced as the only real alternative to returning to the previous system under which each entry had to be individually checked, 'an untenable alternative'.

[ibid., p. 3]

2.8 The main features of the administrative penalties scheme, as summarised in the LRC Report, were:

* An administrative penalty may be imposed. An administrative penalty may be imposed on the owner of goods if a person 'knowingly, recklessly or otherwise' makes a false or misleading statement on the basis of which the amount of duty said to be payable on the goods is less than the amount of duty properly

payable. Imposition of the penalty is at the discretion of the Comptroller-General of Customs . . .

* Amount o f the penalty. If a penalty is imposed, it is twice the amount of duty underpaid or $20, whichever is the greater.

* Penalty may be remitted. The Comptroller may, on application, remit the penalty in whole or in part. In considering whether to remit the penalty the Comptroller can take into account four matters only:

— voluntary admission that the statement was false or misleading — risk to the revenue — capacity to avoid the misstatement

— the applicant's previous history. [ibid., p.l]

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(b) Mr Richardson's first encounter with triple dipping

2.9 It is the procedures concerning remission which are of principal relevance to the Richardson case. As the LRC summary indicates, where an importer or a customs agent makes an error in a customs entry and a penalty is imposed it is possible to apply to the Comptroller for a remission of the whole or any part of that penalty. In considering such an application the Comptroller can take into account only the four matters listed in the LRC summary (para. 2.8 above). It is the fourth of these matters, the applicant's previous history, with which the Richardson case is concerned.

2.10 Mr Richardson first encountered on 26 September 1990 the practice which Senator Bishop later dubbed "triple dipping", namely, the Customs practice of counting the error histories of all parties - the owner of the goods at issue, the individual customs agent and/or the customs agency — when determining remission applications. Mr Richardson believed that only the history of the party responsible for the error should be considered.

2.11 As will be obvious, if the history of all participants could be used by the ACS in determining a penalty, regardless of whether all three were responsible for the error, it would be both administratively convenient and lucrative for the ACS to take the records of all three into account when making decisions as

to remission of penalty. If, on the other hand, the ACS were required to establish that the error was made by a previously-blameless importer, agent or firm it might become more difficult to argue before a body such as the Administrative Appeals Tribunal (AAT) that the full or a significant penalty should be imposed.

2.12 In the early operation of the administrative penalties scheme, this question was open to doubt. Then in November 1990 the AAT ruled in a case brought by another agency (the Walker case [AAT S90/33]) that the history of only the error-maker should be used in the determination of penalty. The ACS accepted this decision but was still faced with the dilemma of what to do in remission cases where none of the parties involved admitted responsibility for an error. In such cases the ACS annotated its records to show that responsibility was shared, and encouraged importers and agents to clarify who was responsible for an error when filing claims for remission.

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2.13 Mr Richardson lodged appeals with the AAT in respect of two cases [S90/235 and S91/52] in which "triple dipped" penalty histories were used. One of the

cases was discontinued when the ACS remitted the remainder of the penalty, and in the other the Tribunal refined the Walker case ruling by determining that the error history of an agent's nominee (employee) should not be taken into account. These cases became the vehicles for a crusade by Mr Richardson

against the administrative penalties regime and he invested a great deal of his and his employers' time in them.

2.14 Mr Richardson's undoubted expertise in the area, and his commitment to ensuring that the scheme, about which he stated that he had doubts even before the passage of the legislation, was administered fairly, led him to raise his concerns in a wide variety of forums, and to follow all proceedings on the

matter in great detail. Thus it was that, on reading evidence given by Customs officers before Estimates Committee A, he noted discrepancies between his understanding of the operation of the scheme and information given by the officers during committee hearings and, through the Minister,

in response to questions in the Senate.

2.15 As a result, he built up two dossiers of matters which he regarded as constituting false or misleading evidence before the Senate and its committees. It was these dossiers which were tabled in the Senate and subsequently referred to this Committee for consideration as to whether

Mr Richardson's assertions were correct.

2.16 The question of Customs' alleged misleading of the Senate in respect of the administrative penalties scheme also appears to have become linked in Mr Richardson's mind with the alleged threat, to be discussed in the next chapter, that he would be destroyed if he gave evidence before the JCPA on the Midford matter. It appeared to him that, everywhere he turned, he was being obstructed in his efforts to right a wrong. This may ultimately have cost

him both his health and employment (see, for example, his submission to the Senate, dated 30 April 1992, p. 1 and p. 15).

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Committee's methodology in determining whether false or misleading answers were given to the Senate or a committee

2.17 As the above brief account indicates, the questions for determination were extremely complex. The Committee needed to determine how much of the convoluted dealings between Mr Richardson and ACS had to do with the question whether the Minister and officers had given false or misleading evidence to the Senate and Estimates Committee A. The first task performed was to break down the statements made in the two documents tabled in the Senate into a series of allegations, of which there were 28. These allegations were further grouped into a series of eight elements, all connected to the

administrative penalties scheme.

2.18 The matters examined by the Committee covered details such as whether accurate information had been given by officers on the time Customs officers took to make remission decisions, the two cases brought by Mr Richardson before the Administrative Appeals Tribunal and the relationship between them, and the nature and initiation of legal proceedings. The primary purpose of such close examination was to evaluate the statements made by Mr Richardson against the source documents quoted in his statements to the Senate. While the Committee does not pretend to the same level of expertise as that displayed by Mr Richardson, the Australian Customs Service or indeed Senators with a special interest in the area, its examination of the claims made by Mr Richardson against the documents on which he based those

claims has enabled it to gain sufficient knowledge to make an evaluation of answers to questions in the Senate and estimates committees in terms of the question of contempt.

2.19 Consonant with its previous comments about the defensive culture of the Australian Customs Service, the Committee has concluded that, in respect of the matters raised by Mr Richardson, the then Comptroller-General of Customs, and his officers, were not as forthcoming and helpful as they might

have been in respect of answers given during oral evidence to Estimates Committee A. In respect of answers to questions on notice given by the Minister responsible for the Customs Service, the Committee considers that the answers were adequate under the circumstances.

18

2.20 It is beyond dispute that the detail of the administrative penalties scheme is highly technical, with specialists in the area capable of placing quite different interpretations on questions asked and answers given during an estimates committee hearing. The Committee appreciates that oral answers given to

questions by Senators not specialists in Customs processes might well appear to a specialist in the area to constitute either false or misleading evidence. Having examined the allegations by Mr Richardson, however, the Committee has concluded that in no case do the answers in respect of the administrative

penalties scheme appear to be false in material particulars. In several cases, however, the perfunctory nature of the answers might well have had the effect of misleading Senators as to the operation of the scheme.

2.21 There is room for doubt as to whether the brevity of answers by officers of the ACS was intended to mislead or was even deliberately unhelpful. From the perspective of those officers, their answers were at least plausible, although as hearings proceeded over a period of a year or more they could

have been expected to take into account the developing knowledge of Senators and to provide more comprehensive answers. However, the Committee can understand that, given the stress that some experience in giving oral evidence, officers may consider themselves as fulfilling their obligations to the

Parliament by giving the bare minimum of information in answer to specific questions. The Committee notes that this approach is not confined to officers of the Customs Service.

2.22 So far as the questions on notice were concerned, the answers given by the Customs Service were not unreasonable, depending significantly, as they did, on an interpretation of the questions which accorded with their understanding of the operation of the scheme. The Committee also noted that, on several occasions, answers given by Customs officers were perhaps

less complex and strained than alternative explanations postulated by Mr Richardson.

2.23 The Committee therefore considers that, while it is unhappy with the general tenor of oral evidence given to Estimates Committee A, and notes that it was in keeping with ACS performance during other inquiries, notably before the JCPA, it should not make a finding that a contempt of the Senate was

19

involved in the matters raised by Mr Richardson in respect of the administrative penalties scheme administered by the ACS.

2.24 The Committee was mindful that at the time matters were being raised in the Senate and its committees the modifications to the scheme were new, having come into effect only in July 1989, and all persons involved were feeling their way in their operation. Thus, when parties had recourse to the Administrative Appeals Tribunal, there was legitimate room for disagreement

as to the interpretation of rulings, and the likely outcome of the cases before the AAT.

2.25 The Committee also observes that the introduction of the administrative penalties scheme in 1986 and the modification of the scheme in 1989 formed part of a pattern of dramatic change to which the Australian Customs Service was accommodating and adjusting during the period when the Midford case arose. As the former Comptroller-General of Customs, Mr Frank Kelly, pointed out to the Joint Committee of Public Accounts in a paper, dated 14 June 1994 and tabled in both Houses on 17 November 1994, responding to

that committee's recommendation no. 91 in the Midford report that he review the levels, functions and suitability of ACS officers involved in the Midford case:

37. The ACS had just undergone, in September 1987, a major restructuring from a hierarchical regionally based model to a functionally oriented approach, adopting devolved decision making principles. Officers were adjusting to the new

organisational requirements and lines of responsibility and accountability. 38. The case was one of the first Crimes Act

prosecutions of a major Customs fraud attempted by either DPP or ACS and for ACS was the biggest fraud case it had ever attempted to handle. It was also the first quota fraud case pursued by the ACS and the legal grounding of the quota arrangements came under question for the first time in a criminal matter. 39. In effect two agencies in the midst of redefining

themselves undertook a new and complex task. There were no established procedures governing the relationship between the DPP and ACS. The

20

environment within which individual officers were working was demanding in any event. [Paper, p. 9]

2.26 Furthermore, as Mr Kelly states later in the paper:

43. There is one very important aspect about this structure which should, with hindsight, be brought out. Many of the key players at the senior management level within Customs were generalist

members of the Senior Executive Service. They were officers with appropriate and wide experience in a range of areas and, according to the

management concept which underlies the SES, were capable of managing in any area assigned to them. They were not required to be specialists, even though they had to supervise expert officers,

such as experienced investigators. I do not believe that situation to be inappropriate for ordinary times. What happened with Midford, however, was that there were newly assigned SES officers,

dealing with a major case, relying quite properly on their experienced investigation staff and being guided and directed by outside and independent legal advisers. But the SES officers, during these early stages of the Midford case may not have

been well enough equipped themselves to challenge the specialist advice and direction that they were getting from outside. [ibid., p. 11]

2.27 That Mr Richardson's prediction of likely outcomes in respect of the administrative penalties scheme, and his interpretation of the resultant AAT rulings, proved to be more accurate than those of the ACS says much for his professional competence. From the perspective of the ACS, the level of

competency in this complex and technical area, combined with the communications breakdowns which are inevitable in a large, recently restructured, decentralised organisation, might have led to inadequacies of prediction and of outcome at least in the short term. The Committee believes

that, while the structural changes do not excuse ACS behaviour, notably at the time of the Midford case but also in subsequent years, they go some way to explaining the lack of technical expertise and inadequate management during this crucial time. The Committee has therefore decided that any

21

misleading of the Senate or an estimates committee under these circumstances was unintentional, and thus has concluded that a finding of contempt should not be made.

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CHAPTER 3

POSSIBLE THREAT OR INJURY

Introduction

3.1 Mr John Richardson has claimed that he was driven out of his profession by deliberate actions of the ACS as a result of his giving evidence to the JCPA. This general claim comprised 18 specific allegations, each of which was investigated by the Committee. The principal individual allegation, that a

threatening phone call was allegedly made to Mr Richardson in an attempt to deter him from giving evidence to the JCPA, is dealt with in this chapter, which also discusses in general terms whether the threat was carried out.

The telephone threat

3.2 As summarised in Chapter 1, Mr Richardson claimed to receive an anonymous STD phone call on 17 April 1991 at his IFF office in which he was told not to give adverse evidence against Customs in the Midford inquiry. Mr Richardson described the threat before the JCPA as follows:

Subsequent to the threat, I wrote down the telephone conversation as I remember it; incidentally, it was an STD phone call. The caller said, 'Can I speak to John Richardson, please'? I said, 'Speaking'. The caller said, 'We have never met, but I would like to talk to you about the Midford inquiry'. I said,

'May I ask who you are and what you want to discuss'? The caller said, 'My name doesn't matter, but I want to know if you are going to give evidence before the Midford commission'? I said, Ί have not seen the terms of reference and I have not been

approached. Why do you ask'? The caller said, 'This call is just to let you know that if you do make a submission or give evidence you'd better not say anything that will embarrass

23

anyone at Customs'. I said, 'If I am called, I have to say the truth. I will not commit perjury'. The caller said, You have to look after yourself. If you say anything bad about Customs or some officers we will put you out of business and make it so bad for you within your industry, you'll be unemployable'. I said, 'That is a bloody good attitude. How are you going to do that? What are you frightened of? The caller said, 'Listen, smart arse, we have ways and means, and if you don't cooperate you've had the dick. You are finished, you are upsetting people'. I said, 'Not my fault if some people do not like the truth. I told Kelly this matter would not go away. I do not like being dragged into this simply because Customs and the DPP fouled up'. The caller said,

You've been warned. Just be kind; if not, it's your funeral. We've got long memories'. The caller then hung up. [JCPA Hansard, pp. 287-88]

3.3 Mr Richardson revealed the threat to his employers shortly after it was made and to a "Customs Minister's adviser, Senior Customs Officer and Customs Brokers Professional Body Executives and IFF prior to 1 May 1991".

3.4 Despite the alleged threat Richardson decided.to make contact with the JCPA. On 28 May 1991 he wrote to the JCPA stating that there were references to him in documents provided to Estimates Committee A and the JCPA and offering some explanatory comments. The JCPA invited him to make a written submission, which he forwarded on 14 June 1991 [JCPA S I243], He appeared before the JCPA on 29 August 1991 and gave evidence

concerning the Midford case, the threat, and administrative penalties matters including the two cases on which he had initiated appeals to the AAT.

Alleged consequences of the threat

3.5 Mr Richardson, having reported the threat to the JCPA early in its inquiry, has subsequently made the general claim that the threat was fulfilled in that his career as a customs agent was deliberately destroyed by the ACS. He has given three reasons for the claim. First, he was actively hostile to the prosecution of the Midford case, even before charges were laid. Second, he gave evidence to the JCPA inquiry into the Midford case despite an anonymous telephone call threatening to destroy his career if he did so. Finally, he campaigned against the administrative penalties scheme and the practice of triple dipping. He claims that, for these reasons, the ACS put

24

pressure on his Adelaide employers to discredit him and to cease to employ him.

3.6 Mr Richardson succumbed to work-related stress on 25 March 1992, a month after his first dossier of allegations was tabled in the Senate and 6 weeks before the second set of allegations was tabled. He returned to work on 1 July 1992 as part of a rehabilitation program but remained for only a week and is

now, in his words, "unemployed and unemployable". His health remains very poor and he has had to be hospitalised on at least two occasions. As indicated in Chapter 1, in November 1993, on the recommendation of an inter­ departmental committee established in response to the JCPA report, Mr

Richardson was awarded $1,490,978 in compensation by the Federal Government.

Was the threat made?

3.7 The first task for the Committee was to determine whether the threat was actually made and, if so, by whom. The primary evidence as to the threat comes solely from Mr Richardson, who took note of the telephone call, as described at paragraph 3.2 above, and mentioned it to several persons at or

soon after the time it was made.

3.8 It appears from the evidence that, at that stage, Mr Richardson did not take the matter so seriously that he felt intimidated by it, and this attitude persisted even to the time of his appearance before the JCPA. That committee, of course, regarded the matter with grave concern, as recounted

at paragraphs 25.13 to 25.21 of the Midford report [JCPA Hansard, p. 287].

3.9 The level of concern by the JCPA was not, however, shared by the Australian Customs Service (ACS). In those paragraphs, the Joint Committee describes its futile efforts to encourage the then Comptroller-General, Mr Frank Kelly, to investigate Mr Richardson's claim:

In March 1992 the Committee enquired of the Comptroller- General as to what action he had taken to investigate the threat made against the Customs Agent. He said 'In relation to the alleged threat, I have not done anything'. He added that he was

expecting the Committee to say it was a serious matter and to

25

request him to conduct an investigation. In relation to an occasion when the Agent mentioned the threat to the junior Minister's Senior Private Secretary, the Comptroller-General said that 'there was no indication at that stage that the threat may have come from Customs, so frankly I have not pursued it.' [JCPA Report, para 25.14]

3.10 The JCPA took the view that, by March 1992, when it queried Mr Kelly on the matter, it had already made its view known, and concluded as follows:

The Committee therefore found it difficult to accept the Comptroller-General's claim that he did not conduct an investigation because he was awaiting the Committee to 'come and say that this is a serious matter'.

Up to the time of tabling this Report, the matter had still not been investigated by the ACS. It occurred to the Committee, however, that one reason why an investigation had not been initiated could be that the ACS already knew the source of the threat.

[JCPA Report, paras 25.20 and 25.21] .

3.11 This Committee, too, is concerned at the lack of action by the Australian Customs Service. If the JCPA's views were not made clear to Mr Kelly before March 1992, the transcript of evidence at that time makes it abundantly clear that the JCPA expected some action from him. This Committee notes in passing that Mr Kelly's passive approach to investigating what all parliamentary committees regard potentially as the most serious of all contempts contrasted with his exhaustive and thorough investigation of an allegation, discussed in Chapter 4, that he had made personal remarks about Mr Richardson. It is also noteworthy that, despite the JCPA's terse remarks on the question in the Midford report, which was tabled in December 1992, Mr Kelly did not even then initiate moves to examine what was by any standard the most serious allegation contained in the report.

3.12 It was not until the matter reached the Committee of Privileges in May 1993 that the Comptroller-General directed that an investigation be undertaken. Following an exchange of correspondence between the then Chair of the Committee of Privileges and the Minister, Senator Schacht, in which

26

assurances were sought and given that investigations would not hamper the Committee, the Comptroller-General, on 4 June 1993, asked the Australian Federal Police to conduct an inquiry. The report of the Australian Federal Police, of 9 September 1993, in response to the Comptroller-General's letter,

is as follows:

9 September 1993

Mr John Drury Acting Comptroller-General Australian Customs Service Customs House

CANBERRA CITY ACT 2601

Dear Mr Drury

I refer to the Comptroller-General's letter of 4 June 1993 to Commissioner McAulay requesting the Australian Federal Police (AFP) to investigate the alleged telephone threats made against Mr John Richardson, Midford's former Customs Agent, during the course of the Joint Committee of Public Accounts inquiry

into the Midford Paramount Case and Related Matters. You may recall that the incident is alleged to have occurred in April 1991.

The AFP has carried out extensive inquiries including conducting an interview with the former Customs Agent and has obtained documentation and information from other sources to assist with the investigation. A difficult impediment has been

the length of time since the alleged occurrence. Certain records of telephone calls made at the time are no longer retained by Telecom.

The AFP investigation is now complete. From the information available it is not able to identify the person responsible for making the threatening telephone call to Mr Richardson.

No further action will be taken by the AFP unless additional information becomes available.

Yours sincerely

(Signed) Brian C Bates Deputy Commissioner

Operations

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3.13 The Committee of Privileges draws particular attention to the following sentence:

A difficult impediment has been the length of time since the alleged occurrence. Certain records of telephone calls made at the time are no longer retained by Telecom.

3.14 The Committee of Privileges regards this conclusion as almost inevitable and is disturbed that the JCPA's suspicion expressed at paragraph 25.21 of its report (see para. 3.10 above) cannot be proved or disproved. This is unfortunate since, as the JCPA has pointed out, that committee had asked the Comptroller-General as early as March 1992 what action he had taken.

It seems extraordinary to this Committee that, despite what might be described as the acerbic exchanges between the JCPA and the witness, no action at all was taken by the Australian Customs Service until after the matter reached the Privileges Committee more than a year later. The action was to seek, on 4 June 1993, the investigation by the Australian Federal Police referred to in paragraphs 3.12 and 3.13. .

3.15 In attempting to determine the question whether a threatening call was made, the Committee examined three hypotheses. The first was that Mr Richardson concocted the story. The second was that there was a call and it was made by a person either within the Customs Service or someone closely connected to the ACS. Finally, as was suggested as a hypothesis by a member of the JCPA at the time the matter was raised before the Joint Committee of Public Accounts [Hansard, pp. 310-318], there was a call but it might have been made by someone who wished to encourage Mr Richardson to give

evidence against Customs to the JCPA, knowing that a threat would make him even firmer in his resolve to give evidence to that committee.

3.16 While there is no direct evidence that would enable the Committee to conclude that the threat emanated from the ACS, the fact is that a threat to put Mr Richardson out of the customs business could be put into effect only by persons within Customs. Mr Richardson had no reason at the time to

invent the story, and it could have been regarded in the interests of Customs to ensure that information was withheld from the inquiry. Accordingly, the

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most plausible conclusion that the Committee can reach is that a threatening call was made and that it is likely that the call was made by a person within the Australian Customs Service or someone closely connected to the ACS.

3.17 The Committee has come to the reluctant conclusion that the trail is now so cold that it is not possible to take the matter any further. The Committee must accept that, given that the Australian Federal Police, despite extensive inquiries into the matter, have not been able to identify the person

responsible for making the threatening phone call to Mr Richardson, it is unlikely that the Committee would have any greater capacity to do so.

3.18 It is unsatisfactory that, as a result of the tardiness in undertaking investigations into the matter, honest and honourable officers of the ACS are in the position of having the finger of suspicion pointed at their activities at that time. The Committee would like to assume that the threatening call, if

made, was made by a rogue individual without the knowledge or consent of anyone from the ACS connected with the Midford inquiry. However, the inaction at the time when investigations might have borne fruit means that the Committee has no alternative but to leave the question hanging. If Mr

Kelly had wished to dispel any suspicion that ACS was responsible for the threat, and to seek alternative explanations, the option was open to him to initiate inquiries as soon as he became aware of the claim of the threat, or at the very least by March 1992, when the JCPA's attitude to the matter was so

transparent and unambiguous. He did not do so.

Was the threat carried out?

3.19 The Committee now turns to the second element of this matter, whether the threat was in fact carried out. As the discussion in Chapter 2 demonstrates, the relationship between Mr Richardson and the ACS became increasingly acrimonious. The difficult relationship appears to have escalated after

Mr Richardson's move to Adelaide and was closely associated with his actions relating to the administrative penalties scheme.

3.20 Mr Richardson acknowledges that he was opposed to the introduction of the administrative penalties scheme and that he committed himself to opposing

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the manner in which it was implemented by the ACS. He campaigned vigorously against the way the scheme was administered on a wide variety of fronts: in addition to appeals to the AAT and complaints to the Federal Police he lobbied the minister and his staff, pursued the matter through customs agents associations, and wrote critical submissions to parliamentary inquiries and to the Ombudsman.

3.21 It is not surprising, therefore, that his complaints to and allegations about the ACS were greeted less than enthusiastically by that organisation. While the official ACS response to Mr Richardson was, on the whole, civil if somewhat brusquely bureaucratic, Customs management was not always as sensitive to nor as intelligent as it might have been about the wider ramifications of the issues he raised. A less defensive, more cooperative, attitude when these matters were raised, particularly in parliamentary forums, would have led to an earlier, more amicable, and infinitely less traumatic, resolution of the issues.

3.22 Mr Richardson's confrontation with Customs appears to have begun with the Midford investigation in Sydney in 1987, and continued in Adelaide with his appeals to the AAT. In late 1990 and early 1991 these cases were being raised in Estimates Committee A and before the completion of the second AAT case he had become involved in the JCPA inquiry. During this period relations with his employer became difficult as a result of the amount of time he was devoting to these matters during business hours; his health began to deteriorate; and eventually, in late March 1992, he ceased work.

3.23 It is not surprising that Mr Richardson saw the adverse turn in his fortunes as resulting from these factors and it is also not difficult to see how he could come to believe that they were not random but part of a conspiracy to destroy him. The Committee, however, has reached the conclusion that, while the problems suffered by Mr Richardson may have resulted from his long confrontation with Customs, there is no evidence of any conspiracy by the ACS or its officers to punish him as a result of his giving evidence to the JCPA.

3.24 It must be emphasised that the genuine and understandable differences of opinion between the ACS and Mr Richardson over the administrative

30

penalties scheme might not have developed into a long-running confrontation, with the attendant consequences for his employment and health, if Customs had not been burdened by the defensive culture to which much reference has been made in this and other reports.

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CHAPTER 4

MISCELLANEOUS MATTERS

Introduction

4.1 This chapter addresses the remaining series of allegations which, although somewhat at a tangent to the main questions placed before the Committee by its terms of reference, might, if sustained, lead to the conclusion that contempts had been committed.

Alleged derogatory remarks about Mr Richardson

(a) By Comptroller-General

4.2 This matter relates to the allegation by Mr Richardson that Mr Frank Kelly, at a meeting held in Adelaide, made derogatory remarks about him. Mr Kelly has consistently and persistently denied the allegation, most recently in his submission to the Committee of Privileges as follows:

Mr Richardson has alleged in paragraph 3D(8) of his submission to the Senate dated 17 February 1992 that I made a personal attack on him. He claims that in a meeting held in Adelaide, I made certain remarks which were derogatory in nature. I

categorically deny that any such statements were made. These allegations were supported by the evidence provided to the JCPA by a former Customs officer, Mr Liam Hogan.

This issue was raised during the JCPA inquiry into the Midford Paramount Case and at Senate Estimates Committee hearings in 1991 and 1992. In addition, an information was laid with the AFP by Mr Richardson alleging that I had committed a

contempt of the AAT.

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Following receipt of the complaint, the AFP referred the matter to the Director of Public Prosecutions (DPP) for preliminary advice as to whether an investigation was warranted. The DPP examined the issue and advised the AFP that an investigation into the alleged statements was not warranted . . .

I would also draw the Committee's attention to the submissions I made to the JCPA on 23 March 1992 and 19 August 1992 in which I categorically and absolutely denied the allegations made by Mr Richardson. In addition, during Customs appearance before Senate Estimates Committee A on 9 April 1992, I was questioned on this subject by Senator Bishop. Once again, I denied categorically that I had made any remarks about Mr Richardson's capacity to hold a Customs Agents Licence during a general staff meeting in Adelaide. Attachment C contains copies of my statements denying the allegations and an extract from the Estimates Committee transcript of 9 April 1992 for your information.

In the context of the Committee of Privilege's examination of this issue, I maintain that no false or misleading statements were made to the Senate or a Senate Committee by me in relation to this allegation.

[Submission, 16 October 1993, p. 2]

4.3 The Committee wishes to make two points concerning Mr Kelly's submission. First, his reference to the DPP advice to the AFP concerning the alleged remarks might be read as indicating that the DPP had concluded that it was not worth investigating whether the remarks were in fact made. The DPP's remarks related only to the question whether there should be an investigation under section 63 of the Administrative Appeals Tribunal Act 1975, which

concerns contempts of the Tribunal, and the report, after having given reasons as to why it would be unlikely that a contempt would be found, notes that, given that the alleged statement by Mr Kelly was made more than a year before the DPP's investigation, "any action under section 63 of the AAT

[Act was] therefore statute barred" [Attachment B to Mr Kelly's submission].

4.4 The second point relates to Mr Kelly's statement of 19 August 1992 to the JCPA concerning this matter, which he included as an attachment to his submission to the Committee of Privileges. In this statement Mr Kelly describes how he had arranged for statements to be sworn by those who attended the meeting at which the remarks were allegedly made. Thirteen

34

statements were made by ACS officers, including two made by officers who were at Adelaide airport but who did not attend the meeting. Nine of the remaining eleven said that they had not heard any remarks about the AAT or Mr Richardson while two said they heard some remarks (one at second

hand) similar to those alleged by Mr Richardson.

4.5 The evidence is unclear as the what was actually said at the airport. For example, according to one witness, Mr Liam Hogan,

. . . there was a question asked about an AAT case decision that must have been fairly contemporaneous with the date where Richardson was involved, and Kelly said that the decision had been okayed and then said that Richardson utilised the AAT to

his own ends and in his opinion was unfit to be a Customs agent. [JCPA Hansard, p. 1999]

4.6 In contrast, another witness, Mr Nathan Sims, said:

I can remember the AAT finding being raised but have no clear recollection of what was said. I can remember no comments being made in respect to Mr Richardson being a fit and proper person. [JCPA, S10606]

4.7 In his evidence [JCPA Hansard, p. 323] Mr Richardson said that he understood that his name had not been mentioned, though those present would have been able to infer that it was he who was being referred to.

4.8 The Committee believes that it would have been more appropriate for the statements to have been obtained from the witnesses by an independent third party rather than by senior Customs officials. This would have ensured a more credible process and one that was seen to be fair and just. This is

especially important in light of the fact that there was not unanimity among witnesses as to what was said, or not said, at the meeting.

4.9 The remarks allegedly made about Mr Richardson, as reported by those witnesses who claim to have heard them, were derogatory and, if they had been uttered by the Comptroller-General, would have been most injudicious, given the difficult relationship, already apparent, between the ACS and Mr

Richardson. The Committee does not consider, however, that the remarks, by

35

themselves, even if they were made in the terms indicated by Mr Hogan, could lead to any possible finding of contempt by Mr Kelly. The only remaining question for the Committee in such circumstances would therefore be whether, in denying that he had made the comments, Mr Kelly had deliberately given false or misleading evidence on the matter to Senate Estimates Committees over a period of time.

4.10 Faced with the categorical denials by Mr Kelly that he made any derogatory comment at the meeting in Adelaide on either 25 or 26 July 1991, and the ambiguity of the recollections by persons who attended the meetings on both days, the Committee was left with the decision as to whether the matter should be pursued further. If the Committee thought that it could clarify the matter by revisiting the issue more than two years after witnesses' statements were sought and received, and that a finding of contempt on the grounds of Mr Kelly's giving false evidence to a committee might result, it would follow that course.

4.11 Given Mr Kelly's denials, however, the Committee is convinced that, even if what any reasonable person would regard as irrefutable proof were produced to Mr Kelly that he had made such a statement, he would continue to believe that he did not do so at that time. This is suggested by the lengths to which Mr Kelly went to check his memory of the Adelaide events, which, as the Committee has previously commented, was in stark contrast to his inaction in relation to the far more serious accusation that a witness was threatened, possibly by or on behalf of the Australian Customs Service. The Committee has therefore decided that the matter should not be pursued further.

(b) By Mr John Drury, National Manager, ACS Import-Export Control Subprogram

4.12 Mr Richardson has also claimed that Mr John Drury made similarly derogatory remarks about him. In particular, he claimed that:

• at a meeting between ACS official and a customs brokers organisation in Melbourne, Mr John Drury, at that time National Manager of the ACS Import-Export Control Subprogram, made inappropriate comments about him; and

36

• Mr Drury claimed to have used the Topper case to "Kick Richardson's head in and teach him a lesson".

4.13 In his submission to the Committee, Mr Kelly provided a detailed and convincing rebuttal of the first of these claims. In respect of the second claim, Mr Peter Bennett, President of the Customs Officers Association, states that he heard Mr Drury make critical remarks about Mr Richardson, to whom he

later relayed them. In an otherwise trenchantly critical submission on the activities and attitudes of the Australian Customs Service, quoted at length in the next chapter, Mr Bennett is anxious to exonerate Mr Drury from accusations of intimidation - the only question of relevance to the terms of

reference of this Committee - or of bad faith.

4.14 The Committee accepts the defences put forward on Mr Drury's behalf insofar as these actions, even if substantiated, would not by themselves lead the Committee to any finding of contempt in respect of Mr Drury's alleged acts.

(c) By other Customs officers

4.15 Mr Richardson makes a number of further claims that he was ridiculed and unfairly criticised by other ACS officers, both in writing and orally, including that he was portrayed as "an idiot", and as "fair game" to be discredited.

4.16 The Committee emphasises that none of the alleged comments outlined in (a), (b) or (c) was uttered in Mr Richardson's presence, and he often heard about them at second or third hand. Again in the context of whether the alleged comments by other Customs officers would, if proved, constitute contempt in

that they could be regarded as penalising him as a result of his giving evidence, the Committee does not so regard them. Given that the ACS regarded him as an antagonist, it is understandable that Mr Richardson was mentioned in reports, at meetings and in conversations. The Committee has

found no evidence that links these allegations to any threat or improper intent to punish him on account of his evidence to a parliamentary committee.

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Other claims

4.17 Mr Richardson claims that the firm he worked for (IFF) terminated his employment as result of fear by his employer of reprisal from the ACS, and also that his employer was in active collusion with Customs to discredit him. There certainly was a falling out between Mr Richardson and his employer, resulting in his ceasing to work for IFF. The reasons for this parting of the ways are complex, with both parties to the dispute having levelled claim and counterclaim at the other, but include disagreements over Mr Richardson's working methods and the number of working hours he spent on the Midford case and on other matters not directly related to his employer's business. It also appears that Mr Richardson's employer felt some discomfort at having as manager of its customs division someone who seemed to be constantly at loggerheads with the ACS.

4.18 The evidence before the Committee about the termination of Mr Richardson's employment was general and imprecise. While the Committee examined whether it would be possible to pursue the matter further, it reached the conclusion that, in the context of the question of contempt, the various factors which went to the breakdown in the relationship between Mr Richardson and his employer were unlikely to be differentiated with sufficient precision as to

enable any finding of contempt safely to be made.

4.19 Another group of allegations consisted of claims by Mr Richardson that the method in which the ACS conducted the AAT cases in which he was involved constituted part of the campaign to discredit and destroy him. For the reasons given in Chapter 2, the Committee reached the conclusion that the conflicts between Mr Richardson and the ACS in respect of the matters he attempted to bring before the AAT did not arise as a result of his giving evidence to the Joint Committee of Public Accounts.

General conclusions

4.20 The Committee can appreciate that from Mr Richardson's perspective the events about which he has made allegations could appear to be part of a deliberate plan by the ACS to destroy him as a result of his evidence before the Joint Committee of Public Accounts. That the ACS might have an

38

attitude which is conducive to a "search and destroy" approach to those who displease it is discussed in the final chapter of this report.

4.21 However, these same matters may also be seen in another, less sinister, light as discrete events having in common only that they involved Mr Richardson to a greater or lesser degree. Much of the evidence adduced by Mr Richardson was circumstantial, involved problematic inferences about motives of others,

or was dependent on assumptions which, while understandable within the context of Mr Richardson's dealings with the ACS, the Committee could not always accept as valid. If all the events claimed by Mr Richardson to have been part of the ACS plan to destroy him were indeed so, then the number

of individuals who would have needed to have been involved would have been quite large. On the evidence available to it, the Committee did not find that there was a coordinated operation against him as a result of his giving evidence to the JCPA.

4.22 The Committee wishes to emphasise that the defensive Customs culture would be likely to have adverse consequences for any individual, whether from within the ACS or from an organisation which was within the ACS orbit, who did not conform to Customs norms. Mr Richardson, as a dedicated

Customs agent concerned about matters affecting him, his employers and their clients, was persistent in pursuing what he regarded as injustices resulting from ACS administration. The Committee suggests that Mr Richardson's efforts to subject the ACS to external scrutiny led the ACS to

resent his intrusions, thereby creating an environment of prejudice against him. When a person is perceived by senior officers of an organisation as a trouble maker, this perception quickly spreads to those who have direct dealings with the "offender". Equally, for the person who precipitates an

organisation into a mode of defensive hostility, every act can lead that person to conclude that there is a conspiracy against him. The Committee believes that this occurred in the present case.

39

CHAPTER 5

OBSERVATIONS, FINDINGS AND RECOMMENDATIONS

The Customs culture revisited

5.1 As will be clear from the previous chapters, the Committee has been seriously disturbed by the culture of defensiveness which, at the time the incidents involving Mr Richardson occurred, appeared to permeate the Australian Customs Service. As noted in Chapter 1, this culture has been the background

to all inquiries conducted by the array of review bodies listed by the Joint Committee of Public Accounts. In that chapter, the Committee also quoted at length from a submission to the JCPA by Mr Peter Bennett, Federal President of the Customs Officers Association of Australia, who has had nearly a quarter of a century’s experience of the Customs culture.

5.2 In addition to his submission to the JCPA and as mentioned in Chapter 1, Mr Bennett made a submission, in general terms, to the Committee of Privileges. While he explained to this Committee that he would prefer to illustrate the points he made in his submission by giving oral evidence, for reasons explained in the first chapter the Committee determined that, for its

purposes, oral evidence was not required.

5.3 Based on its own experience, as illustrated by comments made in its 46th report, the Committee feels justified in drawing attention to comments placed before it by Mr Bennett as follows:

Finally I would like the Privileges Committee to know that I also have direct evidence of a culture in the ACS which lends itself to intimidation and harassment of parties who challenge ACS management.

41

. . . there is ample evidence of the ACS management taking deliberate action to harm individuals if it is considered in the interests of management or if it is deemed necessary to silence criticisms of the Customs Service.

The Privileges Committee should not take this matter of Mr Richardson being singled out for unwarranted criticism and harassment as an isolated instance. If this was the only incident

then perhaps Mr Richardson would be over-reacting or simply paranoiac. However harassment of individuals is an established part of the Customs culture.

It is very difficult to explain the depth of this cultural practice. Few people have the opportunity to see it in action. Because of my [24] years as an executive officer of a staff association I have had ample opportunity to see the practice in action.

In general terms the system starts by a very senior officer expressing "concerns" or (in the case of Mr Richardson) "disapproval" of an individual. That comment is then carried to a 'branch' meeting where the concerns/disapproval is discussed. A supervisor goes to their work area and tells staff about the matter. The staff are now very aware that the 'system' wants particular attention paid to this individual. The individual suddenly finds that their entries are checked and rechecked, deliveries are delayed repeatedly (or in the case of Officers, they find that their reports are constantly criticised or rejected).

I am under no illusion that the ACS, particularly at some management levels would, if it considered it necessary, contact persons with the intention of persuading them to stop criticisms of the ACS.

It is my view that this practice should be finally identified and exposed for the intimidation and harassment that it is. The ACS has long recognised the pervasive nature of its cultural practice of intimidation. It uses the practice as a form of staff and/or client control. The practice of intimidation is a polished art form in the informal disciplinary repertoire of the ACS.

However the ACS has specifically and constantly refused to acknowledge any possibility of suffering caused by intentional or unintentional intimidation. As a result there is no way to stop the practice from continuing.

42

The only way it seems possible to stop this practice is to hold an act of intimidation to account and made to be an example of wrong doing. I strongly suggest that this matter of Richardson be made an example by which the ACS will be forced to

introduce a system of stemming intentional or otherwise intimidation of staff or clients.

5.4 The Committee has considered whether it should accept this assessment. Furthermore, in the context of its primary function, that is, to make findings as to whether contempts have been committed, endorsing such general comments might be regarded as extending beyond the Senate’s instructions

in such matters. The Committee considers, however, that to make sense of the questions raised by Mr Richardson and the conclusions the Committee has reached it is necessary to emphasise the "culture" and the consequent environment of prejudice in which these matters have arisen and to explain

the devastating consequences for Mr Richardson following the telephone threat which the Committee has concluded must have been made by someone in or close to the Australian Customs Service.

Consequences for whistleblowers

5.5 That the consequences of the Midford matter for Mr Richardson have been devastating has become increasingly obvious to the Committee as its inquiries have progressed. While the award of monetary compensation should, one would have thought, have provided some solace to Mr Richardson, enabling

him to close off that chapter of his life, this has not eventuated. In this context, the Committee points to the delays incurred in reaching a final compensatory determination, with the methodology and process of determining compensation being the subject of trenchant criticism from the Auditor-General [Report No. 25, 1993-94],

5.6 As the Auditor-General points out, despite specific instructions to the contrary from Cabinet, efforts were made to "re-try" the Midford case and it was not until further ministerial intervention occurred that the question of compensation was concluded. The Committee found it astonishing - and

indeed a conflict of interest - that officers from the Australian Customs Service and the Department of Industry, Science and Technology were permitted to participate in the deliberations of the inter-departmental

43

committee set up to examine compensation, while similar privileged access was not given to those seeking compensation. The Auditor-General's report suggests that that participation explained at least in part the delays which occurred.

5.7 The Committee regrets that it, too, has been responsible for drawing out the process for Mr Richardson, but considers that, in order to do justice to Mr Richardson and to those about whom he made allegations, extensive and detailed examination of all issues he raised, and of the extensive associated documentation, was imperative.

5.8 In drawing these matters to attention, the Committee has been influenced by the report of the Senate Select Committee on Public Interest Whistleblowing. In particular, it has found Chapters 5 and 6 of that report a valuable and incisive analysis of the "human dimensions" of whistleblowing, as that committee has titled its Chapter 5. It is of interest to note that the Committee of Privileges, given the nature of its work, frequently has dealings with people who might be regarded as whistleblowers and the Committee's own experience gives it reason to accept as accurate the analysis contained in the Public Interest Whistleblowing Committee report.

5.9 It is unsurprising that Ms Lesley Lyons, the wife of Mr Richardson, found in that committee’s report an excellent if painful exposition of the consequences of whistleblowing which have led to the transformation of her husband. She made her views known both to that committee and, as mentioned in Chapter 1, to the Committee of Privileges. This Committee has decided to publish her letter as an appendix to this report, in order to illustrate the effects that being caught in a bureaucratic maze can engender in an otherwise committed and capable person. In these terms, it does not matter whether a committee such as the Privileges Committee makes a finding of contempt against an individual or an organisation. A useful function will have been performed if it succeeds in bringing home to public officials the consequences which may result from thoughtless actions and decisions.

44

Findings

5.10 The Committee now turns to summarise its responses to the specific questions which it has been required to determine, that is:

(1) Having regard to the letter of 13 May 1993 to the President from the Joint Committee of Public Accounts, whether there was any improper interference with Mr John Richardson as a witness, and, if so, whether any

contempt was committed.

(2) Having regard to the submissions made to the Senate on 25 February and 4 May 1992, whether any false or misleading answers were given to the Senate or a Senate committee, and, if so, whether any contempt was

committed.

5.11 The Committee finds as follows:

In respect of term of reference (1):

(a) a threatening telephone call was made to Mr John Richardson, in an attempt to prevent his giving evidence to the Joint Committee of Public Accounts in relation to the matter referred to that committee on 5 December 1990 (the Midford/Paramount case);

(b) it is likely that the call was made by a person within the Australian Customs Service or someone closely connected to the ACS;

(c) in the light of previous unsuccessful investigations by the Australian Federal Police and the passage of time since the incident occurred, it is unlikely that the Committee could successfully uncover the source of the call;

(d) that the threatening call constituted a serious contempt, but there is no identifiable individual or organisation who may be held accountable for the contempt; and

(e) Mr Richardson suffered serious penalty and injury as a result of his dealings with the Australian Customs Service, but on the basis of the evidence before it the Committee is unable to conclude that the penalty and injury were incurred as a consequence of his having given evidence to the Joint Committee of Public Accounts.

45

In respect of term of reference (2):

(f) While questions answered and evidence given to the Senate and estimates committees, as described in Chapters 2 and 4, were at times unhelpful, the answers and evidence could not be regarded as intentionally misleading and thus do not constitute a contempt.

Recommendations

5.12 The Committee draws attention to its observations at pp. 12-14 of its 46th report (Parliamentary Paper No. 43/1994), and, in particular, to its comments at paragraph 2.20 of that report about the review of the Australian Customs Service tabled in the Senate on 8 February 1994. It notes that a new head of the Australian Customs Service has been appointed and looks forward to the necessary legislative and other changes being introduced and implemented to

give full effect to the recommendations of that review.

5.13 The Committee reiterates its optimism, expressed in the 46th report, that the implementation of the Conroy Report recommendations will break down the Customs culture which gave rise to the Committee's three Customs references over the past few years. However it recognises that the necessary attitudinal changes will take some time to effect. In order to assist in this process, the Committee of Privileges recommends that the Senate request the Comptroller-General of Customs to circulate copies of this report to all senior officers of the Australian Customs Service.

5.14 Given the extensive and time-consuming inquiries undertaken by so many organisations, in particular by both the Joint Committee of Public Accounts and this Committee over the past five years, and the concerns revealed by each, the Committee considers it appropriate to recommend that a watching brief be maintained over the Australian Customs Service by the appropriate Senate committee. Accordingly, the Committee of recommends that the following matter be referred by the Senate to the Senate Economics Legislation Committee:

46

Continuing scrutiny of the implementation of recommendations contained in the Conroy Report entitled Review of the Australian Customs Service, tabled in the Senate on 8 February 1994.

Baden Teague Chairman

47

A P P E N D I X

Committee of Privileges Australian Senate, Parliament House, Canberra, A.C.T., 2600

15 September 1994

1 9 SEP 1994

CLERK'S OFFICE

Attn: Ms.Anne Lynch - Secretary

Ref: INQUIRY REGARDING JOHN RICHARDSON

Dear Ms.Lynch,

I am writing to the Committee following the Important Report by the Senate Select Committee on Public Interest Whistle­ Blowing - "In The Public Interest", as John’s psychologist Dr.Hari Dahm believes chapter 5 of this Report an excellent

encapsulation of the methods used to Victimize John and some of the medical effects he is suffering.

Dr.Dahm believes it Important that Parliament is now aware of the Devastating effects to Individuals careers, Personal Life and Health when they are Victimized, as well as the Great Importance people like John place on the Westminster System, Parliament and bureaucratic accountability.

Accordingly, please find attached, photocopies of chapter 5 of the Select Committee’s Report, together with the mentioned article by Dr.Jean Lennane, which appeared in the British Medical Journal. Dr.Dahm believes these documents will assist

your Committee to understand just how completely John has been destroyed by all the actions against him.

As a result of what was done to him, my husband has been totally destroyed as a person, will never work again, will carry permanent medical disabilities, is in danger of suffering a further Stress related heart attack which could

prove Fatal and will require medical treatment for many years to come. Furthermore, the actions against him have had a most drastic affect on my Valued marriage and home life, as well as affecting other family members.

In particular, chapter 5 of the Committee’s Report shows that the Sufferings of those Victimized where bureaucratic Wrong­ Doing has been exposed has not gone un-noticed. The Report also recognizes my point that Individuals in the Private Sector may also be Victimized by their employers and has recommended that Protection be given to people like my husband.

/ 2

2

Dr.Hari Dahra, discussed Report chapter S with John’s daughter and John as part of his treatment, as Dr.Dahm believes this chapter is well researched and well written to describe in such graphic detail the Sufferings of the Victims and their

families.

Dr.Dahm said that the Senate Select Committee should be commended for its grasp and understanding of this most Unacceptable treatment of Principled individuals and further commented that John is visible proof that what that Committee

found was done to them does indeed happen.

As the Select Committee observed, there is a very distinct predictable pattern to the Victimization, with minor variations to the pattern and John got it all in one way or another, as is easily verified from documents before the JCPA and your Committee.

It is fortunate that people like my husband and Whistle­ blowers have such high respect for the Par1iamentary Process and Law and do not generally seek to sanction those who cause their Suffering. The down side to this is that instead of

exploding they implode and tend to take it out on themselves - hence suicide, which may be physical, or psychological.

Those causing the Innocent to suffer often go unpunished and this appears to cause great Distress and Anger to those Victimized. Dr.Dahm says John is imploding and committing psychological suicide. Dr. Lennane also says that John’s reactions are normal for someone in his situation.

As as result of what has been done to John, my Valued Marriage is in shreds and Dr.Dahm believes it is only my even tempered devotion which has kept things going. It is imperative that John be isolated from any further Lies and Deceit which may emerge during your Inquiry as his reaction and stress may produce drastic results. Dr.Dahm believes it

imperative that all efforts be made to save our marriage, otherwise its failure will be another factor exacerbating John’s Injury. I have instructions to try not to discuss Customs, IFF, or its directors with John.

Dr.Dahm has told John to continue his faith in Justice and the Integrity of Parliament to see exactly what has been done to him and deal with Lies and Deceit.

/ 3

3

As I understand it, Dr.Dahm is basically concentrating on Dr.Lennane’s step 3 on page 669 of the British Medical Journal - "Seeking the best exit", so that John’s suffering is alleviated to a degree where life is tolerable, instead

of one of hopelessness, depression, loss, anger and all the other medical problems that appear in the Senate Report.

As Dr.Lennane’s paper reveals and Dr.Dahm believes, it is likely that John will go through the rest of his life unable to forget what was done to him and the aftermath.

I do not know how it will all end. It is not easy when John has Stress Attacks. It is difficult to cope with over a long period and it is not easy to sleep, as I am constantly aware that he may have a Fatal Stress Attack during the night.

I also have to worry that it may all get too much for him and I will come home to find he has abandoned everything and gone. John’s daughter is also caught up in it all and often visits Dr.Dahm with John, as I do when I can.

All I know is that it is difficult for anyone who has not suffered as Whistleblowers and John has, to understand just how devastating it all is - the John Richardson whom I married has been destroyed - However the Select Committee

Report and Pariiamentary Protection of John will hopefully help to prevent other Innocent Individuals suffering from similar Victimization.

It is not easy to put such a complex matter in a short letter and I have tried to be as brief as possible. It will be appreciated if this letter and attachments are placed before the Committee and Members as soon as possible.

Thanking you, Yours faithfully,

Lesley Lyons (Richardson)

108 Woolnough Road, Largs Bay, South Australia 5016

“Whistleblowing”: a health issue

K Jean Lennane

Abstract Objective—To examine the response of organi­ sations to “whistleblowing” and the effects on individual whistleblowers.

Design—Questionnaire survey of whistleblowers who contacted Whistleblowers Australia after its publicity campaign.

S etting—Australia. Subjects—25 men and 10 women from various occupations who had exposed corruption or danger

to the public, or both, from a few months to over 20 years before. Results—.All subjects in this non-random sample had suffered adverse consequences. For 29 victimi­

sation had started immediately after their first, ||| internal, complaint. Only 17 approached the media. 11 j Victimisation at work was extensive: dismissal (eight * ‘ subjects), demotion (10), and resignation or early

retirem ent because of ill health related to victimisa- |j! don (10) were common. Only 10 had a full time job. j ! Long term reladonships broke up in seven cases, and r I 60 of the 77 children of 30 subjects were adversely

affected. Twenty' nine subjects had a mean of 5* * 1 3 stress related symptoms initially, with a mean of 3*6 still present. Fifteen were prescribed long term treatm ent with drugs which they had not been | prescribed before. Seventeen had considered

I suicide. Income had been reduced by three quarters i or more tor 14 subjects, io ta ! financial loss was | estimated in hundreds of thousands of Australian j dollars in 17. Whistleblowers received little or n o

i h elp from statutory authorities and only a modest j amount from workmates. In most cases the corrup- : tion and malpractice continued unchanged. | I Conclusion—Although whistleblowing is import -j j ant in protecting society', the typical organisational j | r esponse causes severe and longlasting health. ! j financial, and personal problems for whistleblowers | I and their families.

| Introduction I “Whistleblowing” is defined in the American i Whistleblower Protection Act 1989 as occurring when a present or former employee discloses information

“which the employee reasonably believes evidences a ; violation of any law, rule, or regulation, or gross ; mismanagement, a gross waste of funds, an abuse of | authority, or a substantial and specific danger to public

j health or safety.” Recently it has become an important issue in Britain: health professionals who have spoken * out about changes to the NHS that adversely affect patient care have been dismissed or otherwise disci­

plined.1-1 There have been similar reports from New Zealand5 and Australia,4 and in the United States nursing journals have extensively covered the long­ standing issues of incompetent or impaired surgeons,

corrupt hospital administration, and maltreatment of patients.74 As in the McBride case,’ the exposure of fraudulent research depends largely on whistleblowers. Other important public health issues are environ­

mental contamination; the safety of roads, trains, and aeroplanes; and protection from disease. To prevent disasters we depend on the conscientiousness, efficiency, and incorruptibility of the responsible

Itreet, w South Wales Lia

institutions and, if things have slipped, on individual whistleblowers to raise the alarm. But however desir­ able whistleblowing may be for the public good, people who expose corruption and malpractice, even in a

democracy, do so at considerable personal risk. A support group, Whistleblowers Australia, was founded in July 1991 because of concern about cases of victimisation of whistleblowers. After a publicity-

campaign many previously unknown whistleblowers made contact, and it rapidly became obvious that thev were seriously traumatised with appreciable health problems. Although the protective legislation recog­ nises that whistleblowers are likely to suffer, there are no published medical reports on their suffering, and,

although most whistleblowers seek medical help, there is no guidance on how best to care for them. 1 conducted a questionnaire survey late in 1992 of whisdeblowers who had contacted Whistleblowers Australia during the previous 12 months.

Subjects and methods A questionnaire was developed in consultation with Whistleblowers Australia. Tnis covered problems which seemed common, including items from a less

detailed survey in the United States.10 One hundred and fifty seven people who had contacted the support group were asked if they would agree to receive the questionnaire. Ninety two questionnaires were sent

out to those who agreed, with a reminder two months later. Thirty five were returned in time for this analysis. Although the questionnaires were anony­ mous, suspicion of Whistleblowers Australia, then an

unknown quantity, seemed a major factor for failing to respond; reluctance to reopen old wounds was another. Tne sample was not random in any way. Subjects made contact because they were dissatisfied.

There were 25 men and 10 women from several states. Only two were under 35 years of age; 22 were between 35 and 50; and the rest were over 50. Ten had exposed the corruption or malpractice less than two years before; 11, 2-4 years before; five 5-10 years

before; five 11-20 years before; and four more than 20 years before. Eight were public servants; four each were in health, transport, or teaching; three each were in banking or

finance, law enforcement, or local government; and the remaining six worked in other disciplines, including four who had not worked for the organisation thev had_ confronted.

Subjects classified the type of problem they sought to expose predominantly as corruption (often coupled with waste and mismanagement) and danger to the public (table I). Some cases entailed both.

Results All subjects had started by making a complaint internally, through what they considered were the proper channels. Three had not made a complaint but

submitted a report during the normal course of their duties. Three subjects had not progressed beyond making an internal complaint. The remaining 32 had subsequently complained to some official external

body—for example, ombudsmen, memoers ot parlia-

f m e 307 1 1 SE PT E M B E R 1993

667

table ι— Corruption and malpractice exposed by 35 whistleblowers

No of subjects

Corruption

Estimated cost to taxpayer ($A): 100 million 3

1 million-30 million 9

100 000-900 000 6

Thousands 5

Danger or damage to public

Discasc/contamina ti on 2

Unsafe: Hospital equipment 1

1

Railway signals 1

Work conditions 1

Licensing of incompetent drivers 1

Child sexual abuse Arson-sabotage 1

Wrongful eviction 1

Insider trading 1

Immigration rackets 1

menr, their union, the Independent Commission Against Corruption, the auditor general. The number of external bodies appealed to ranged from one to 13.

Only 17 subjects had approached the media and then only after exhausting internal and external avenues. Fifty external bodies were mentioned, covering several states, so the numbers for each were small. Only three were rated as helpful by more than one person. Unions scored two helpful ratings but also six harmful, seven neither helpful nor harmful, and one hopeless. Only six bodies scored any helpful mentions, while there were 22 harmful and 51 neither helpful nor harmful mentions.

The problem complained of continued unchanged or increased in 25 cases, decreased in four, and was unknown in the remaining six. No action had been 1 ί taken against those responsible or they had been

promoted in 30 cases, and in five cases those respons­ ible had received minor disciplinary action. In only one 1 case were all those responsible disciplined and none promoted.

Thirty four of the 35 subjects had been victimised as a result of exposing the misconduct; the one exception had not been working for the organisation concerned. In three cases victimisation started before any complaint—for example, when they refused a bribe. In 1 26 it started immediately after their first complaint. In

five it was delayed (range 3 weeks to 8 months). The form of victimisation is detailed in table II. Of the 31 people originally working for the body they con-

lii

TABLE II— Types of victimisation experienced by 31 whistleblowers

. N o of subjects

Major change to job

Dismissal 8

Pressured to resign 15

Position abolished 3

Transferred to another town 5

Pressed to take redundancy 1

Informal tactics

Personal isolation 17

Removal of normal work 15

Abuse/denigration Forced psychiatric referral

15 13

Under scrutiny/regular inspections 12

Impossible demands 9

Physical isolation 8

Threat of: Defamation action 7

Disciplinary action Demotion

7 5

Accusations Other harassment* 18

•F or example, performance of menial duties, denial of benefits, barring from site, removal of files, death threats, adverse reports, fines, internal inquiries, falsification of records, unrelated charges, adverse reports sought from previous supervisors.

fronted, only three were still employed by the orga^ tion at the same level. Five others had been dcm0te, with three more having taken prolonged sick leavc ' workers’ compensation. Eight had been dismiss? Three had retired at the expected time; another ^ had retired early or resigned because of ill hej ' related to victimisation.

Ten of the whole sample were currently unemploy^ two were working pan time for a new employer, ^ two were receiving an invalid’s pension. Only 10 of^ 35 were currently working full time in any job.

Fewer than 18 subjects received support workmates; 26 of them were ostracised, 3ctjy^ victimised, and betrayed to some extent. Twenty seven had been in a long term relationship ? the time they exposed the corruption or malpractice Twenty were still in that relationship, which had be-

negatively affected in 10 and positively affected in on* the effect was neutral in nine, but most subjects citinga neutral effect made it clear that there had been bog positive and negative components. Five of the remain- mg seven said that the whistleblowing was wholh responsible for the breakdown of the relationship; tw o said that it was partly responsible. Five had neve married, two saying that their whistleblowing mad; finding a partner difficult.

The 30 subjects with children had a total of 77. 0; these, 60 had been adversely affected by divorce an; forced separation of their parents; disrupted educ­ tion, anxiety, insecurity, and stress; poverty; public attacks on the parent’s image; anger and loss of faith: and the parent giving a role model of constant conflict being preoccupied, absent, unable to relate, and i: poor physical or mental health and having little tira; for or interest in the children’s activities. Three cass involved organised crime: one family was unable to go out because the father was under police protection wit: a contract on his life; a 6 year old girl received i personal death threat letter; and a teenage boy’s pes were killed.

Loss of income occurred in 25 cases. In 11 the decrease was half or less; in 14 it was three quarters o: more. Other costs were predominantly legal and medical. Total estimated financial loss was thousand!

of Australian dollars in six, tens of thousands in eight hundreds of thousands in 16, and one million in oas long running case. Twenty nine subjects experienced symptoms th.;y attributed to stress. The most common were difficulty in sleeping, anxiety, panic attacks, depression, suicidal thoughts, and feelings of guilt and worthlessness

Other symptoms included nervous diarrhoea, trout# in breathing, stomach problems, loss of appetite,"1 !0* ·* of weight, high blood pressure, palpitations, hair lofe grinding of teeth, nightmares, headaches, tiredness· weeping, tremor, frequency of urination, and feefo?

stressed. In addition, one subject developed diabet- and another stomach cancer, which both attributed1 0 the stress but were probably not related to it. ThoSi with symptoms had an average of 5-3 when under p·* greatest stress and an average of 3-6 currently. Fifi^- were prescribed drugs that they had not been takici belore for depression, hypertension, and peptic ulce^ Two had attempted suicide, one twice; 17 ha“d ^ sidered suicide, 10 seriously. Eighteen subjects non-drinkers at the time they blew the whistle. Of

19 current drinkers, five considered that drinking ^ now"a problem. Six were smokers. All had increase their intake. ^

Thirteen subjects (10 men, three women) forced by their employer to see a psychiatrist, un ~ threat of disciplinary action. Subjects saw a median three (range 1 to 6) psychiatrists. Four found * experience helpful or neutral and nine found it unhcT fill or distressing. In three more cases the empl°'

BMJ v o l u m e 307 11 Se pt e m b e r 1

£

f i v o l u m e

tned to insist on a consultation with a psychiatrist but was successfully resisted. Γ" , .

The most upsetting: aspeas of the experience were classed as lies, deceit, and corruption in high places (15); attacks or harassment (five); effects on health or career (four); destruction of family and distress to family and friends (four); the guilty not being brought

to account (three): and isolation, loneliness, and loss of friends (three). Nineteen subjects said that they still rhrmghr about the whistleblowing and its aftermath daily. 18 of them

for an hour or more. Tnis occurred regardless of how long ago it happened. Fifteen subjects thought that they had been damaged as a person by the experience, 13 felt

strengthened, and six felt both damaged and strength­ ened. In an estimate of personality type with a rough adaptation of the Myer Briggs system, 21 subjects were

introverted and 14 extraverted.1 1 On the remaining three axes the sensing, thinking, perceiving combina­ tion occurred in 16. Twenty one subjects classed themselves as Christian

and 14 as having no formal belief. T he motives behind their action were described by 31 subjects as duty, justice, concern for others, and a desire to stop the wrongdoing; two gave no reason and two more personal reasons.

Despite what had happened, 23 subjects said that they would to it again because, “Deep down I know I did the right thing, and by my doing it, it may help others to do the right thing.” Six said that they would not and six were unsure. Twelve, however, advised

others not to expose corruption or to think hard or twice about it. Other advice was to be thoroughly prepared: get outside help or advice first, research legal and other aspects, document everything, including by

audio tape and videotape, and go straight to an outside agency rather than expose oneself to the employer. When they were asked who or what had helped them most four responded “nothing”; 10 nominated family

members or a helping professional; and 12 other whistleblowers.

Discussion This non-random sample cannot be said to be typical of everyone who blows the whistle. Whistleblowers who had been fairly treated would not have contacted Whistleblowers Australia. Those who contacted the

support group may not be typical either, perhaps being h | ) more assertive or less thoroughly crushed than others i I j who did not. Nevertheless, in this small and essentially 11 i anecdotal study the similarity of the treatment meted

: | out by different management staff, in different ! organisations, and even in different countries13·14 is • striking. “They all seem to be following the same j handbook,” as one subject put it. Some techniques,

such as putting the whistleblower in a bare office wvtK no telephone, seem almost diagnostic.

1 S H O O T IN G T H E M E S SEN G ER

j In their response organisations can use any number of staff, for as long as it takes, to wear the lone | whistleblower down. Their aim seems to be to isolate | whistleblowers as incompetent, disloyal, troublesome,

mentally unbalanced, or ill; to force them to leave;'to frighten and alienate workmates and other supporters; and to avoid examining the issues they are complaining about. In the survey this had mostly been achieved:"tEe

wrongdoing continued, while the whistleblowers were left discredited and in poor health and poverty with their careers in nuns. *

Whistleblowing is a type of “principled organisa­ tional dissent, ”IS highlighting parallels with heresy, 1

mutiny, political dissent under totalitarian regimes, and intellectual dissent.'* Principled dissenters chal­ lenge immediate and accepted authority because of conflict with what they regard as a higher authority— truth, justice, the public interest, or God.

Whistleblowers, however, may not always realise they are dissenting as the stated principles of organisa­ tions usually outlaw malpractice. It is often shattering for them to find deviance supported while they are*

savagely victimised. ’ ~

It is disappointing that statutory authorities so often fail to help, seeming, like most workmates, to side with employers as pan of the authority system. Obedience to authority and group conformity seem to be central to

this. In the agentic state described by Mil gram most people seem willing to do almost anything to others, disregarding personal morality, as long as some authority figure seems to be ultimately responsible .1T

Forcing whistleblowers to see psychiatrists in order to discredit them, usually as having a personality disorder that could account for their irrational obses­ sion with malpractice, is reminiscent of Soviet misuse of psychiatry.18 If the first psychiatrist’s repon is unhelpful the subject can be forced to see another until the desired result is achieved. This practice is clearly unethical: coercion invalidates consent. (The person­

alities of the subjects in this study were not unusual, but nearly half were of the sensing, thinking, perceiv­ ing type (about 12% of the population), which is considered to be particularly suited to quality control

or accountancy.11)

C ARING FOR T H E M ESSEN G ER

Doctors whose help whistleblowers seek voluntarily should aim at avoiding the common end result of lonely and bitter obsession, chronic anxiety, and other stress related illness in someone who is often unemployable

and whose family is suffering or gone. The victims must be reassured that what they are experiencing is a recognised phenomenon, occurring "not because of their inadequacy but because of the

organisation’s failure to deal with the issues they have raised. Attacks on their credibility, competence, personality, and worth are “shooting the messenger” and to be understood as part of the process rather than

taken personally. Intense guilt, anger, and mistrust are normal responses, and victims need safe opportunities to express these emotions to the doctor while not allowing them to increase the painful isolation they are

already feeling. The doctor also needs to advise on priorities. Intensely preoccupied with the injustice of the employer’s reaction, and often incapacitated by

anxiety and depression, whisdeblowers tend to expend all their energy trying to get action on the malpractice. But this may take many years, and four priorities must apply·

(1) Look after the whistleblowers’ physical and mental health. Victims have to be convinced of the need for regular excercise, relaxation, and time off from the stress. Support will reduce the need for

symptomatic relief, but antidepressants may become necessary. Patients should be warned of the risks of dependence on alcohol, smoking, and benzodia­ zepines, which should be used only sparingly. Previous

vulnerability—for example, from abuse in childhood —may be reactivated and will usually require psychi­ atric referral. (2) Provide support for spouse and family. The

doctor can help by seeing the spouse, arranging appropriate referral, and helping the couple to over­ come the feelings of guilt and shame that may be inhibiting their enlisting help from family, church, and

community. (3) Seek the best possible exit from what is happen-

II.

! i

1 1 SE PT E M B E R 1 9 9 3

669

This is the first in a senes o f a nicies that describe the ways in which methods o f economic evaluation m ay be used to assess the economic costs and consequences associated with different form s o f health care intervention.

Institute for Health Policy Studies, University of Southampton, Southampton S09 5NH Ray Robinson, professor of health policy

BAQ 1993307:670-3

mg at work. Transfer to another department or leaving with the best possible financial settlement may be possible. Periods of sick leave are often needed to give breathing space from victimisation in order to consider options adequately.

(4) After all of these are in place start tackling the malpractice. The doctor may be able to advise on external sources of help and support. But what helped many whistle­ blowers in this study most was the opportunity to meet others in the same situation. Most did so for the first time through Whistleblowers Australia. If there is no

such contact point available it would be worth con­ sidering setting one up by advertising locally.

PREV EN TIO N

Prevention of the problem, rather than its manage­ ment, is obviously preferable. Given the importance of the issues, preventing whistleblowing itself is not really an option. Prevention of the workplace reaction is essential, which the legislation tries to do. Unfortu­ nately, the reaction nearly always starts immediately

after the first (internal) complaint. By the time whistle­ blowers realise that the complaint is not being handled appropriately it is already too late—the employer has victimised (possibly dismissed) them and is unable to i withdraw without losing face and possibly being liable | for'damages | Educating managers is essential—on group

dynamics, the damage done to whistleblowers, their families, and the community, and the damage that failure to correct malpractice will in due course do to . the organisation their denial tries to protect. More

research, including both managers and staff, is

urgently needed to find ways of changing ^ ant and potentially devastatine aspe^T— j ***Φθιΐ behaviour. *

I thank Ingrid Reynolds for help in designing naire and for reviewing the manuscript.

1 Warden J. Speaking out in the NHS. B M J 1992305:1180. 2 Dyer C RHA told to reinstate "redundant" Helen Zeitiin o., 1177. 1*2.

3 Dyer C NHS whistleblower wants charter. BMJ 1 9 9 2 3 0 4 :2 0 3 4 Smith R. Whisde blowing: a cune on ineffective organ. 1992305:1308-9. 1Qcra-

5 Essex C New Zcland doctors strike over contracts. BM J 1993βθ6 2ο , 6 Anonymous. Doctor gag—an election issue. Australian Mediant J 7 Anonymous. Blowing the whistle on incompetence—one nu . Nursing 1989;19(7):47-50. ‘

8 Andersen S. Patient advocacy and whisde-blowing in nursinr h ihelpers. Nursing Forum 199035:5-13. fe* t^9 John D. McBride found guilty of scientific fraud. BMJ 1995,306 54 j10 McMillan J. Legal protection of whisdeblowers. In: Prasser S γNorthercote J, eds. Corruption and reform, the Fuzgerzid vision, o ** ** University of Queensland Press, 1990.11 Myers B. Gifts differing. Palo Alto: Consulting Psychologists Press, 19gn ,12 Ewing DW. How bureaucrats deal with dissidents. In: Hammer YrOrganization shock. New York: WDcy, 1980:328-31. '"· **13 Hoffman W. The Ford Pinto. In: Hoffman W, Moore J, eds. Sunvoreadings and cases in corporau mortality. New York: McGraw-Hill ' 249-60. ^ **14 Lam pen N. Whistleblowing m the Soviet Union: a study of comply.abuses under state socialism. Birmingham, New York: Schockca Bcc*,** association with the Cenffe for Russian and East European £-·< * University of Birmingham, New York, 1985. '~""v15 Macmillan J. Principled organizational dissent: whisde blowing in rap.**,corrupton. In: Proceedings of the fourth international anti-corruption Canberra: Australian Government Publishing Service, 1989:91-6.16 Martin B. In: Martin B, Baker A, Man we 11 C, Pugh C, eds. ίχ-y_| ,suppression. North Ryde, New South Wales: Angus and Robertson 19^4 χ 86. ‘ " ‘17 Mil gram S. Obedience to authority— an experimental view. New York: Hr-_and Row, 1974.18 Koryagin A. The involvement of soviet psychiatry in the persecutor 4dissenters. BrJ Psychiatry 1989;154:336-40.(Accepted 20July 1993)Economic Evaluation and Health CareWhat does it mean?Ray RobinsonEver since the concept of value for money in health care was introduced into the NHS, economic terms and jargon have become part of our everyday lives— but do we understand what the different types of economic evaluation all mean, particularly those that sound similar to the uninitiated? This article introduces readers to the purpose of economic evaluation, and briefly explains the differences between cost-minimisation analysis (used when the outcomes of the procedures being compared are the same); cost-effectiveness analysis (used when the outcomes may vary, but can be expressed in common natural units, such as mm Hg for treatments of hypertension); cost-utility analysis (used when outcomes do vary—for example, quality of life scales); and cost-benefit analysis (used when a monetary value is being placed on services received). Further articles will deal with each one in more detail.Economic evaluation is a technique that was developed by economists to assist decision making when choices have to be made between several courses of action. In essence, it entails drawing up a balance sheet of the advantages (benefits) and disadvantages (costs) associated with each option so that choices can bemade. Although the precise forms of economic - evaluation may vary, the “cost-benefit” framework a j common to all of them and constitutes the distinctive j feature of this approach.OriginsThe most widely known form of economic evalu> j tion, cost-benefit analysis, was developed over 50 j ago to assist public sector investment planning. Unlike the private sector, where costs, prices, and profits be used as a guide to decisions about investment, and services provided by the public sector are on- provided free (or at least substantially below their co& of production) or the prices charged to the consum- do not reflect the full social benefit of the service. ' such cases there is a need for an alternative to p r o ­sector profit and loss accounting. „Early applications of cost-benefit analysis * ' undertaken in the United States during the 193 s connection with flood control programmes. In B1 "* ^ it started to be applied widely during the 196 ^ transport investment projects (for example motorway, the Victoria underground line, an proposed third London airport). Since then it has , applied in various forms and contexts, inc,u ' j education, town planning, and health care.670 BMJ v o l u m e 307 11 September

13

2.16 Various forms of whistleblower type protection either already exist'9 or

are being developed. Specific whistleblower legislation has been enacted in South

Australia and the Australian Capital Territory and has been or is being drafted in New

South Wales and Queensland. The Committee supports the view that a concerted and

co-ordinated approach to promoting and instituting whistleblowing as a legitimate

means of exposing wrongdoing needs to be adopted.

2.17 The Committee believes that a co-ordinated approach to whistleblower

legislation at federal and State levels will encourage and lead to more effective

accountability within the public and private sectors. As stated in evidence to the

Committee:

whistleblowers' legislation provides one way of monitoring [the] misuse and abuse of power. The monitoring occurs through individuals disclosing information they believe reveals illegal activities or maladministration. In so doing, individuals provide the opportunity for those responsible to rectify that illegality and maladministration, and the

community benefits.1 9 20 *

2.18 Many of the submissions and the evidence received by the Committee

during the inquiry relate adverse personal experiences of individuals who had suffered

victimisation and reprisal action for having the courage to expose wrong-doing.

Members of the Committee were deeply moved by these personal experiences and

the distress whistleblowing had caused these people. However, the Committee also

recognises the harm that may be caused to the reputations of individuals and

organisations who are subject to false or misleading public disclosures.

19 Such a s th e common law principle which may provide protection for em ployees against dism issal w hen making disclosures about criminal or civil wrong by an employer. S ee John McMillan, Legal Protection of Whistleblowers,in Corruption and Reform: The Fitzgerald vision, UQP, St Lucia 1990, p.208.

20 Equal Opportunity Commission (South Australia), evidence p.391. This view w as supported in many other submissions.

184

Committee is that national guidelines are to be settled and eventually endorsed by the

AMA Federal Council.31 The Committee welcomes and supports this decision.

9.75 The Committee recognises the extent to which psychiatry can be used

as a. means to discredit a whistleblower. There is still a social stigma attaching to

mental illness, and it is that stigma which makes psychiatry such an attractive and

powerful m eans of retaliation to an employer organisation. Referrals occur at a time

when an assessm ent is being made of an individual who is already under stress as

a result of having blown the whistle. The referral of a whistleblower to a psychiatrist

can have the following ramifications:

a) It signifies to colleagues that management regard the whistleblower as “unbalanced"^ thus effectively silencing further dissent and/or support for the whistleblower;

b) It refocusses the attention of an inquiry from the

whistleblower's allegation onto the mental competency of the whistleblower;

c) It undermines the self confidence of the whistleblower. Not only must the whistleblower deal with the referral itself, but he or she must also deal with the doubts the referral may raise about his or her competency in the minds of colleagues; and

d) It casts a shadow on the whistleblowers integrity,

s oundness of mind, judgment and reputation, both work wise and personally, which, once cast, is almost impossible to remove.

9.76 The Committee considers the use of psychiatry in this manner to

constitute an infringement of human rights, and to be, perhaps, one of the most

insidious and vile weapons used against whistleblowers. For this reason, the

Committee strongly urges the medical profession to settle the relevant guidelines and

31 S ee correspondence from Dr P.S. Wilkins, Assistant Secretary General, AMA, to the Committee dated 8 April 1994 (published as a response to Submission no. 29).

CHAPTER FIVE

WHISTLEBLOWING: THE HUMAN DIMENSIONS

5.1 In this chapter the Committee describes from the whistleblowers

perspective the human dimensions of whistleblowing. Evidence, both formally

received by the Committee and anecdotal, has been utilised to portray the people who

become whistleblowers, describe their motivation and seek to understand the personal

effects they suffer from the act of whistleblowjng.1

5.2 In providing this perspective, the Committee acknowledges the evidence

of so many witnesses which bears testimony to comments by Dr Simon Longstaff of

the St Jam es Ethics Centre.

In discussing the issue of whistleblowing, there is a tendency to lose sight of the fact that our deliberations have a direct bearing on the welfare of individual human beings and, through them, on society at large. It is somewhat paradoxical that in developing systems and

procedures that protect whistleblowers one can be seduced by the intellectual challenges of developing technique to such an extent that the human scale of the problem is lost from sight.1 2

The Committee wholeheartedly endorses these sentiments.

5.3 The Committee believes that people who have not been exposed to the

human dimension of whistleblowing are often sceptical of the motives _ of

whistleblowers and are unaware of the impact upon the lives of those who have taken

1 The sco p e of the c a se histories received by the Committee can be seen from the resum es of whistleblowers' experiences provided by the Q ueensland Whistleblower Study and Whistleblower Action Group - QWS evidence pp.1012-1016 and WAG evidence pp. 1073-1084. For other whistleblowers' personal experiences recounted in evidence se e Len Wylde and

Jack King, pp.413-421; Ken Smylie, pp.431-432; Christina Schwerin and colleagues, pp.490­ 508; Alwyn Jo h n so n , pp.525-556; Bill Toomer and Keith Potter, pp.558-588; Dr Kim Sawyer, pp.627-640; Shirley Phillips, pp.648-657; Dr Jean Lennane, David Roper, Kim Cook, Vince Neary and Alan Barry, pp.711-719; Greg McMahon, Tom Hardin, Peter Jesser, Robert Osmak,

Robin Rothe, Denis Grove and Gordon Harris, pp.1106-1123; Kevin Lindeberg and Des O'Neill, evidence pp. 1132-1144; Bill Wodrow, pp. 1372-1384. T hese c a se s and many others are detailed in th e subm issions received by the Committee.

2 Dr Simon Longstaff (St Jam es Ethics Centre), Submission no. 118, p.2.

f

60

this drastic step. Indeed, the members of the Committee developed a greater -------------- --------- — .'Ld..*-------- n A -iT tfi iv S r iw v.v-·, rp'- Γ · ' ’··â–  · - ——

understanding and appreciation of the personal issues involved with whistleblowing

as the inquiry progressed.^

W h is tle b lo w e r s u p p o r t g r o u p s

5.4 An academic study of approximately 100 whistleblowers and their cases,

known as the Queensland Whistleblower Study (QWS),3 has been undertaken by the

Department of Social Work and Social Policy at the University of Queensland. This

study investigated the personal and organisational impacts of public sector

whistleblowing in Queensland since 1990. It has created a valuable data base on

whistleblowers and their personal experiences. By bringing together a large number

of whistleblowers, the Queensland Whistleblower Study provided the genesis of the

Queensland Whistleblowers Action Group.

5.5 Whistleblower support groups are growing in each State. These groups

operate with voluntary assistance and are staffed by dedicated individuals.

Whistleblowers Australia4 which operates on a national level with branches in a

number of States and the Whistleblowers Action Group (WAG)5 which operates as

an autonomous group in Queensland, are the major support groups for

whistleblowers. Not only do these groups provide support, counselling and general

assistance, but they have also developed a capacity to lobby on whistleblowing in the

abstract and on behalf of individual members in particular. WAG is also assisted by

the Queensland Justices and Community Legal Officers1 Association through the

provision of legal and financial support. It is primarily from the evidence of these

groups, their members and other whistleblowers that the Committee has based its

comments on the personal experiences described in this chapter.

3 Q ueensland Whistleblower Study, evidence p.1011.

4 W histleblowers Australia, evidence p.699.

5 W histleblowers Action Group, evidence pp.1093, 1100 and 1129.

61

W h o b e c o m e s a w h is tle b lo w e r v*

5.6 Recognition of whistleblowers and the role of whistleblowing has grown

significantly in recent years. As discussed in Chapter 4 the importance of

whistleblowers to the Fitzgerald Royal Commission, references to the subject in

parliamentary and other government reports and the move towards legislative

protection by a number of States and territories are indicative of the growing

awareness and acknowledgment of the practice and influence of whistleblowing.

5.7 Evidence given to the Committee has suggested that this is reflective of

a demise within the political and public administration environment in Australia.

Witnesses have constantly referred to a diminution of the traditional values of ethics,

honesty and professional integrity at ail levels of society, A culture of self interest and

reduced responsibility has overtaken that of public duty and the greater national

interest. It is within this environment that the practice of whistleblowing has steadily

grown.

5.8 The Committee received submissions and heard evidence from many

whistleblowers during the course of its inquiry. They came from the Commonwealth

and State public sectors; local government institutions and instrumentalities; police,

banking, legal and health care professions and academic institutions. Geographically,

whistleblowers were not restricted to particular States. Submissions were received

from all States indicating that whistleblowing is an activity undertaken on a nationwide

basis.

5.9 Members of the Committee had not previously realised that the

occurrence of whistleblowing was so widespread and involved such diverse areas of

public and private sector employment. The people who become whistleblowers cover

a wide cross-section of society. They have diverse socio-economic backgrounds and

a range of educational qualifications. Yet within this diversity there was a commonality

in the type of person who becomes a whistleblower.

62

5.10 Whistleblowers are generally^ noted for their intrinsic honesty and

integrity. The Queensland Whistleblower Study has reported that the whistleblowers

in its study are mostly model employees. They are described by QWS as extremely

conscientious and, before deciding to blow the whistle, regarded as highly valued

employees by their organisation. They are invariably educated, experienced, efficient,

hardworking, honest and perceptive of how their organisation functions. They have

been socialised through their family and through the education system to believe in

the institutions of the Westminster system, such as Parliament and bureaucratic

accountability. Tney believe in the system's safeguards - principally the law and the

administrative procedures and authorities established for the purpose of protecting the

system1 . They expect that such authorities will undertake their duties in an honest and

ethical manner. QWS indicates that it is, therefore, with a feeling of great faith and

certainty that they approach these authorities when they see some form of

wrongdoing with an expectation that the authority will deal with the matter in an honest

and ethical manner. The action, or in many cases lack of action, subsequently taken

by the authority is often regarded by the whistleblower as inadequate, inappropriate

or unsatisfactory. The whistleblower finds it difficult to believe and accept this reaction 1

to their disclosure, resulting in significant levels of disaffection with the bureaucratic

structures and loss of faith in the system' generally.6

5.11 Not all people become whistleblowers by making a deliberate decision

to blow the whistle, usually after considerable soul searching and possibly even taking

legal advice. In some instances people may become whistleblowers almost by

accident. A person who is in the wrong place at the right time may inadvertently

become a whistleblower after seeing a wrongdoing and simply commenting upon it

within their working environment. Pressures brought to bear may compel such a

person to make a moral choice - to either conform by accepting the wrongdoing, or

dissent and blow the whistle.

6 Dr William de Maria and Cyrelle Jan (QWS), evidence pp.1037, 1040.

63

5.12 Other witnesses suggested that the problem with whistleblowing is that

they did not realise they were involved until it was too late. Events often 'snowball' so

that they are not aware that they have become a whistleblower until they suffer a

detriment by the organisation. Until that time they believe they have just been doing

their job. This attitude was expressed by many whistleblowers who regarded

themselves as ordinary people simply doing their job.7

5.13 Whistleblowers frequently display a humble and modest attitude. By

contrast a researcher with the QWS asserted that:

whistleblowers are a_valuable_workplace resource. They are the ones who are endeavouring to keep the workplace honest, to keep it efficient and effective. These people are vital and necessary. They are national treasures and should be revered as such. They should not only be

protected but nurtured, encouraged and rewarded. They are_the perfectionists in a 'she'll be right' society.8

M otivation a n d c o n s i d e r a t io n s in b e c o m i n g a w h istle b lo w e r

5.14 Although some people may become whistleblowers almost by accident,

for most the decision to blow the whistle is taken deliberately. In evidence before the

Committee, whistleblowers were described as honest and possessing a great sense

of integrity. The Committee accepts that in the majority of cases a whistleblower is

motivated by a high altruistic concern for the public good.

5.15 However, the Committee recognises that whistleblowers may not always

be motivated by noble intentions. Whistleblowers may also be motivated by personal

benefit, malice or ill-will. The Senate Standing Committee on Finance and Public

Administration Report on the Management and Operations of the Department of

Foreign Affairs and Trade, referred to in Chapter 4, commented upon this aspect in

relation to the actions taken by whistleblowers in DFAT. The F&PA Committee

7 Dr Kim Sawyer, evidence p.638 and Tom Hardin (WAG), evidence p.1111.

8 Cyrelle Jan (QWS), evidence, p.1038.

64

concluded that the actions were "improper, reckless and likely to have damaged the

reputations of innocent individuals and to have been contrary to the public interest".9

5.16 It is sdmetimes not possible to differentiate disclosures driven by altruism

from those based upon lesser motives. Disclosures made in good faith and with the

best of intentions may be based on little more than supposition or innuendo resulting

in adverse effects upon other people and property. Similarly, sincere and well-

intentioned whistleblowers may assert things that are subsequently proven to be

incorrect. Genuine mistakes can be made.

5.17 An issue which may arise when considering a malicious disclosure as

distinct from the frivolous, vexatious or misconceived is that ft is quite feasible that a

factual disclosure could be made with malicious intent.10 1 1 Irrespective of the

motivation such disclosure would still warrant investigation. The impact of motivation

and the accuracy of the disclosure in relation to· protection for the subjects of

whistleblowing is discussed further at paragraph 9.37.

5.18 In determining whether to blow the whistle consideration needs to be

given to the personal privacy and professional reputation of those against whom

allegations are made. Richard G. Fox has recently written that legislation, such as that

being developed by the States as referred to in Chapter 4, defines the categories of

disclosure which are to be encouraged under statutory protection in order to reduce

the need for potential whistleblowers to make personal moral judgements about when

a_matter is sufficiently grave to warrant risking the reputation and morale of those

about whom the complaint is made.11

5.19 A further consideration in determining whether to blow the whistle relates

_to the well documented suffering and indignity that whistleblowers are subjected to as

9 F&PA DFAT Report, op.crt., p.42.

10 Dr Je a n Lennane, evidence p.707.

11 Richard G. Fox, Protecting the Whistleblower, Adelaide Law Review, v.5 n.2 199S, p.145.

65

a resulto? their'action (described later irfthis' chapter) . ’This raises the" question why

anyone would report'"wrongdoing at-all knowing that the likely outcome will be

harassment and victimisation. n 'r’

5.20 The responses from witnesses to this dilemma were varied. Most

indicated that the cause was of such importance that exposing the problem was

paramount. A few indicated that they were unaware that their action could possibly

have led to a chain of events ultimately having such personal impact. Rarely was it

suggested that they should not have undertaken the action.

5.21 The Queensland Whistleblower Study referred to the paradox of

whistleblowing. On the one hand whistleblowing is not worthwhile due to the

overwhelming personal costs outweighing the partial benefits. On the other hand, a

high percentage of whistleblowers, knowing now what happened on a personal level

when they blew the whistle, say that they would do it again. The QWS explained:

Some respondents considered that the costs outweighed the benefits, and therefore they would not do it again. Others thought that corruption and wrongdoing were so entrenched in their organisations that future disclosures would be futile. Nevertheless many reported that they would do it again, notwithstanding the enormous personal and professional cost. Comments like "I could not live with myself [if I saw wrongdoing and did not report it]", are characteristic of these respondents. In effect, their view is that the moral imperative to disclose wrongdoing outweighs the fact that the costs of disclosure outweigh the (tangible) benefits.12

5.22 Many people begin their involvement with whistleblowing by using

internal mechanisms provided by their organisation to receive or investigate

complaints about wrongdoing. These people get fully involved in whistleblowing when

they become frustrated and exasperated at the inaction and ineffectiveness of these

internal mechanisms. They then turn to alternative, usually external, sources such as

the media to voice their complaints. Whistleblowing to the media is discussed in

Chapter 9.

12 Q ueensland Whistleblower Study, evidence pp.1019-1020.

66

5.23 This process, which has been described by many whistleblowers as

typical of their introduction to whistleblowing, does not imply universal condemnation

of the effectiveness of internal mechanisms. Dr William de Maria has noted that some

of the QWS respondents expressed satisfaction with the internal mechanisms they

used.13

5.24 In most cases people do not regard themselves as whistleblowers when

making the initial report to their internal mechanisms. At that time they regard

themselves as just fulfilling an ethical obligation to the organisation or a legislative duty

to report wrongdoing. They are simply doing their job. It is when the system does

not respond and repercussions and harassment begin that they become a

whistleblower.

5.25 One witness described this approach in terms of the only thing a

whistleblower ever wants is an inquiry. They only want people to examine the facts

and give them an honest assessment. They then want to get on with the job they

have been performing.14

5.26 Tne outcome of the action taken by organisations in response to the

whistleblower's disclosure of wrongdoing has been summarised by the Queensland

Whistleblower Study. It indicated that whilst many whistleblowers believed that little

or no response was made to their disclosure, others claimed that their action had at

least some positive impact, even if it was only an equivocal or relative impact. Thus,

despite the generally perceived negativity with which organisations respond to public

interest disclosures some whistleblowers were able to find relatively positive

organisational outcomes to their disclosure.15

13 Dr William de Maria (QWS), evidence p.1060. It was a small group of 10-15% of the QWS respondents who expressed satisfaction with the internal reporting m echanism s they had used.

14 Dr Kim Sawyer, evidence p.639.

15 Q ueensland Whistleblower Study, evidence p.1019.

67

5.27 ' A possible motivation which '·â–  has .· been ..discussed in , relation to

whistleblowing schem es concerns financial reward. ' Australian whistleblowers do not

expect financial reward, unlike the system which operates in the United States.

Indeed, it was argued by many before the Committee that such a system was

opposed to the very reason why they decided to become whistleblowers which was

to take action after being ethically disturbed by the wrongdoing they had seen.

Financial reward has been seen as a dangerous inducement upon which to expect

people of goodwill to report wrongdoing. This aspect is discussed further in

Chapter 11.

P e rs o n a l e f f e c ts s u f f e r e d b y w h istle b lo w e rs

5.28 The overall effect upon a whistleblower at a personal level can be

devastating. Case histories presented by Whistleblowers Australia, the Whistleblowers

Action Group and Queensland Whistleblower Study indicate that the experiences of

whistleblowers conform to a pattern. This pattern was borne out by the evidence of

witnesses before the Committee who described the impact of whistleblowing on their

personal situations.

5.29 The overall personal cost to the whistleblower is enormous - it can

include loss of job, loss of career and employment prospects, financial loss, damage

to personal and professional reputation, protracted legal processes and damage to

personal life, including loss of spouse or partner, family and friends and health. The

traumatic effects of the process often extends from the whistleblower to his or her

immediate family, relatives and friends.

Organisational response to the whistleblower

5.30 The Committee received considerable evidence referring to__the

organisational response to whistleblowers. The corruption within an organisation was

described by one witness as "a cancer". He wrote:

68

The whistleblower identifies the cancer, attempts to remove it, and then is attacked by rt. The attack usually takes the form of harassment of varying degrees of intensity·16 'J

» 1 * d ' · · · J" ’ τ - 7 -V» w - * i ' — ·â– # . ■· - *y=». ^ · * — ........................ · ■, - ■

Although the mode of attack may differ, many experiences of whistleblowers are 'j

disturbingly similar. li

*4 -« n i - V ./

5.31 Whistleblowers Australia describes a process whereby as soon as a

disclosure is made a pattern of behaviour emerges which usually leads to a

predictable outcome. The whistleblower is discredited, their personal life and career

is ruined and they are emotionally and psychologically damaged. The behavioural

response of an organisation to the disclosure is seen as having two phases. First, an

intense stress factor is exerted on the whistleblower which eventually results in a

breakdown of his or her health. Secondly, victimisation and harassment occurs within_

the workplace. The whistleblower is set up, given menial duties to perform, ostracised,

maligned and defamed. Distorted accounts of work practices are submitted. Personal

files damaging to the whistleblower are built up with contrived evidence.17

5.32 It has been noted that this organisational response can occur over a

period of several years and generate circumstances which overtake the initial

disclosure as grounds for the organisations actions.18 Gordon Harris, Secretary of

WAG, described the experience of whistleblowing as a matter

... of_pure survival leaving the messenger often open to ridicule, · contrived charges or plain reprisal from more powerful forces in “the system". The m essage becomes deliberately buried under a smokescreen often making the original alleged corrupt act much worse by_ its deliberate cover-up through either political patronage or i intimidation.19

16 Professor Kim Sawyer, evidence p.627.

17 Whistleblowers Australia, evidence p.699.

18 Len Wylde, evidence p.414.

Whistleblowers Action Group, Submission no. 49, p.14. 19

69

5.33 Organisations reactto whistleblowing by adopting defensive mechanisms

and attempting to discredit the whistleblower. The organisation exerts pressure upon

the whistleblower to prevent him or her publicly exposing the wrongdoing. Internal

review processes and grievance procedures are perceived as strategies designed to

contain dissent within the organisation and silence the whistleblower. Organisations

focus their attack on the whistleblower thereby marginalising, minimalising and

trivialising the problem. It is the problem raised by the complaint which needs to.be

objectively assessed, not the whistleblower who raised the problem in the first

instance.

5.34 Negative characterisation of the whistleblower is frequently cited as part

of the organisational response. The whistleblower is variously cast as "a troublemaker,

a zealot, a crusader, a pursuer of trivia...".20 The unmistakable inferences carried by

the use of such epithets cause substantial damage, not only to the whistleblowers

reputation, but also to the course of the investigation of the disclosure. The insidious

nature of such name calling is that the inferences which are raised are surprisingly

difficult to 'shrug off. The onus of proof swings onto the whistleblower - not to prove

j the^truth or otherwise of the allegations, but to prove that he or she is not incompetent

or unbalanced or vindictive. Organisations and the agency investigating disclosures

! ought to be particularly sensitive to the use of such labels about whistleblowers.

5.35 The whistleblower is accused of diminished work performance and

complaints about personality faults and psychological imbalance are filed against

them. Through a process of victimisation and harassment the whistleblower is

shunned by previously supportive and friendly work mates and becomes socially

ostracised. In effect, the culture of the organisation has imposed itself as staff adopt

·, attitudes and behave in an out of character manner.

20 Professor Kim Sawyer, evidence p.627. See also Whistleblowers Action Group, evidence p. 1091: ’It is a comm on tactic to subjectively attack the individuals personhood by dem eaning and labelling that person as less than nominal'; C.R. McKerlie, Submission no. 54, p.1: Ί will be, at least subconsciously, dism issed as a ratbag, a troublemaker, a m alcontent1; Keith Potter, evidence p.567: ‘busy bodies, dobbers, zealots, stirrers, anti-establishment, etc. ... system buckers'.

Employment related effects . -*:

5.36 Employment -.sanctions tkwhich ra '.whistleblower ■;can -suffer include

disciplinary action such as reprimand, transfer, demotion or dismissal. Other kinds of

actions taken by an organisation against individuals occasionally appear to be less

offensive actions implemented at lower levels. These can be manifested as more

subtle, unofficial or indirect actions such as questioning of motives and personal

attacks, abuse in the workplace by management or colleagues, social ostracism and

intense scrutiny of work practices including investigation of time sheets. Referral for

psychiatric assessm ent or treatment may occur for reasons which are tenuous and

sometimes fabricated. The use of psychiatry is discussed further in Chapter 9.

5.37 Retaliatory measures used against whistleblowers by their organisations

which have been reported to the Queensland Whistleblower Study include:

being a ssigned meaningless work, no work or excessive work; physical isolation, deprivation of resources; retrenchment, dismissal or forced resignation; punitive transfers; legal action designed to exhaust the employee's resources before justice can be had; "blacklisting" and denial of promotional opportunities; verbal and physical abuse; malicious and fictitious counter-allegations of wrongdoing; alleged insanity or other

unsuitability for work; social sanctions such as ostracism; and "stakeouts" by private detectives.21

5.38 In certain professionally oriented areas of employment the actions taken

against the whistleblower amount to intellectual suppression. This can include

withdrawal of research funding, appropriation of intellectual property, restricting access

to or withdrawal of support staff, denial of publication rights and rights to speak at

conferences and destruction of the working environment in general.22 However, the

subject of intellectual suppression or suppression of intellectual dissent is much

broader than just whistleblowing. Dr Brian Martin advised the Committee that:

21 Queensland Whistleblower Study, evidence, p.1017.

22 Dr Kim Sawyer, evidence p.628 and G reenpeace Australia, evidence p.1297.

71

Basically, the concept of intellectual suppression looks at the source of the problem which is the power of various organisations or other bodies to stop a free discussion of ideas. By focusing on whistleblowing, you focus on the person who is perhaps challenging that power and in some

ways is victimised.23

5.39 The Australian Nursing Federation outlined some of the means of

retaliation which may be used against a whistleblower in the nursing profession - the

changing of rosters to disadvantage the whistleblower's employment, relocation of the

whistleblower to an area requiring expertise for which the whistleblower is ill-equipped

causing stress and eventual resignation and the making of notations on a

whistleblowers employment record which can influence references for future

employment.24

5.40 Anecdotal evidence as to the personal effects suffered by whistleblowers

was not limited to whistleblowers themselves or whistleblower support groups. Some

investigative bodies also made reference in their submissions and evidence to these

effects. The CJC described an extensive campaign of victimisation against a

whistleblower which included: malicious rumours about the officer's sexual conduct;

refusal of assistance from peers in the normal course of duties; picked on for trivial

deviations from standard procedures; refusal by other staff to put through telephone

calls; receipt of anonymous abusive and threatening mail and telephone calls and

damage to whistleblower's vehicle.25

5.41 The process of pressuring an employee out of the workplace can be

readily achieved under the guise of redundancy procedures. These procedures

provide employers with an ideal mechanism by which they can rid their organisation

of whistleblowers. In subsequent investigations it can be difficult to prove that a

23 Dr Brian Martin, evidence p.814. S ee also Senator John Coulter, evidence pp.358-3o Intellectual suppression is considered further in the section on Education in C hapter 8.

24 Australian Nursing Federation, evidence p.472.

25 Criminal Justice Commission, evidence p.1165; se e also David Landa (NSW Ombudsman), evidence p.743.

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redundancy (or indeed redeployment or sacking) occurred due to an employee's

whistleblowing and not due to the officially stated reasons of work demands,

incompetence, inefficiency or personality problems. The linkage between

whistleblowing and victimisation may in some cases, be beyond substantiation.

5.42 For the whistleblower problems can become self-perpetuating. The

cumulative effect of the behaviour directed towards the whistleblower can lead towards

reduced competency and efficiency. It is difficult to work at optimum performance

levels when a person is suffering extreme psychological stress of workplace

victimisation, harassment and ostracism. Extreme stress can lead to memory loss and

other symptoms of ill-health which undoubtedly affect workplace performance. Days

off work due to illness often follow and on occasions psychiatric assessm ent may be

involved. These factors are then held by the organisation as evidence that the

whistleblower is unable to cope with the dem ands of the job. They are portrayed as

difficult, obstructive, incompetent, lacking commitment and lazy. The organisation can

then sack the whistleblower with impunity.

5.43 Whistleblowers who have been sacked or forced to leave a particular job

or e mployer often face discrimination in future employment. Case studies provided

to the Committee have shown that whistleblowers face significantly reduced chances

of obtaining future employment.26 This applies across professions. In some

instances whistleblowers have had to leave their chosen profession and apply for

employment in alternative vocations at levels of pay and responsibility no longer

commensurate with their qualifications and experience.

5.44 This loss of career and employment prospects is invariably associated

with considerable financial loss. Some whistleblowers have become involved in

protracted legal processes, the expense of which also significantly affects their

financial situation. The stress generated by legal proceedings can contribute to a

deterioration in health and personal relationships.

26 Desm ond Childs, submission no. 45, p.3.

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Health effects

5.45 Other effects upon whistleblowers involve their personal life. Many

whistleblowers have reported adverse effects upon their physical or psychological

health and well-being, usually attributed to stress. Symptoms have ranged from heart

attacks, palpitations, menstrual irregularities, immune breakdown, migraines and ■ ------ ---- · - . ‘ -

weight gain and loss to insomnia, lethargy, sweats, flushes, agoraphobia, irritability,

paranoia, and thoughts of suicide.27 These general medical effects, particularly

psychological, have been described in an article by Dr Jean Lennane printed in the

British Medical Journal in September 1993.28

5.46 The stresses involved from whistleblowing resulting in psychiatric and

physical ill-health affect not just the whistleblowers, but also their spouses and

children. There are often lasting or long term effects. Resultant medical costs, lost

production and personal suffering and chronic disability are an enormous burden on

both individuals and the community at large.

5.47 Symptoms associated with post-traumatic stress disorder (PTS) appear

similar to those suffered by some whistleblowers. PTS is now recognised as a

medical disorder whicn occurs when a victim's response to trauma involves intense

fear and a profound sense of helplessness. In the crisis the person has had a change_

imposed upon their life with no right of reply. Taken to an extreme this crisis becomes

a trauma. It involves symptoms such as anxiety attacks, nightmares, cold sweats,

paranoia and a general feeling of helplessness.29 For whistleblowers this can be

reflected in obsessive behaviour, pursuing their case with a consuming passion and

a^ loss of judgment in responding to people in relation to their case. Persona^

27 Q ueensland Whistleblower Study, evidence p.1018.

28 Dr J e a n Lennane, ‘Whistleblowing1: a health issue, British Medical Journal vol. 307, Septem ber 1993, pp.667-670.

29 Mayo Clinic Family Health Book, William Morrow and Co., New York 1990, p.1037.

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experience of these symptoms were related to the Committee b y ' a number of

whistleblowers.

5.48 Dr Lennane has noted with interest that it is becoming clear that even

some whistleblower's persecutors are also under intense stress at times and may also

experience adverse effects.30

Effects upon family life

5.49 Personal relationships also suffer. Adverse effects upon relationships

have included decreased friendliness, decreased sexual contact, preoccupation,

irritability, relationship deterioration, and in some cases relationship breakdown.

5.50 Whistleblowers have reported that spouses who may be employed by

the sam e organisation or within the same area of work have suffered personal

harassment and detriment to career opportunity. There are some reports of

whistleblower's children being victimised by class mates at school.

5.51 Evidence given to the Committee has demonstrated that whistleblowers

can be very determined people. It is therefore difficult to understand why

organisations involve themselves in costly exercises pursuing whistleblowers by

attempting to discredit the individual rather than addressing the problem/wrongdoing

which has been raised.31

5.52 This situation was summed up by Bill Toomer who wrote that most

people:

30 Dr Je a n Lennane, evidence p.707.

31 S ee also F&PA DFAT report, op.cit, p.53 which noted that the costs of continuing

whistleblowing activity, to the individual and organisational targets, to the taxpayer and to the whistleblowers them seives can be large and will increase as the episode persists.

CVAi75'R 5DC

can surety see that it is far cheaper to 'grab the nettle1 and investigate a whistleblowers complaint honourably and promptly than to consume vast resources trying to stymie a whistleblower who is likely to proceed in a determined search for redress.

It seem s to me that a person with the type of character who will 'blow the whistle' on crime, wastes and injustices will predictably pursue action indefinitely against those injustices directed against him\her.

It can be self destructive to the whistleblower but the incredible waste of human resource and money by obtuse government authorities is all so needless in a country where such energy could be directed elsewhere to a positive effect.32

Bill Toomer, evidence, p.588.

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

PARLIAMENTARY PAPER No. 322 of 1994 ORDERED TO BE PRINTED

ISSN 0727-418