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Thursday, 13 September 2018
Page: 101


Mr HILL (Bruce) (12:22): An extraordinary thing happened on Tuesday. After question time when no-one was listening, Auditor-General's report No. 6 of 2018-19, Army's protected mobility vehicle—Light, was tabled in the House. It examines the $2.2 billion Hawkei vehicle, a replacement to the Bushmaster. It's an important capability, and I understand a great product locally made. However, there's one aspect of this report that is unprecedented and should be of concern to every member. There are large slabs of the report blacked out—page 9, page 10, page 12, page 43, page 50, page 51, page 53, page 54, page 55 and page 70—because the Attorney-General used a provision in the Auditor-General's Act, which has never been used before, and issued a certificate which gagged the Auditor-General, requiring him to delete large slabs of the report.

I'll set out why the House must not let this pass without scrutiny. The Auditor-General is an officer of this parliament. It was established in 1901 by the Audit Act. It's appointed by the parliament. The Auditor-General is accountable to the parliament. The Auditor-General has no minister. The Auditor-General reports and is accountable in broad terms through the Joint Committee of Public Accounts and Audit, of which I'm the deputy chair. This is a critical distinction and not well understood. The Auditor-General scrutinises the executive on behalf of the parliament. This is absolutely central to any claim of credibility of parliamentary control over the executive in the Westminster system, and the legislative architecture is designed to preserve the Auditor-General's independence.

So, how can he be gagged? A provision to allow this was inserted in 1979 to the 1901 Audit Act. It allowed the Attorney-General to issue a conclusive certificate requiring the Auditor-General to remove certain material from a report if contrary to the public interest—fairly limited in scope: things like national security, Commonwealth-state relations, cabinet confidentiality and so on. The only certificate ever issued was in 1987, when the Minister for Defence sought and obtained a certificate to withhold material for security and defence reasons. In 1997 a successive provision in section 37 was included when the current Auditor-General Act was introduced. This was a controversial provision and at odds with the recommendations of the joint committee report into the bill:

Clause 37 seeks to restrict the Parliament's access to information and documentation held by the Auditor-General … In effect, the powers, privileges and immunities of the Parliament, guaranteed by section 49 of the Constitution, are to be watered down …

What is so extraordinary that the Attorney-General has decided to gag the Auditor-General? At this point we do not know, but there are some clues. The Attorney-General, I will give him this, has been clever in his stated reasons, referencing 'one or more' provisions of section 37(2) in gagging the Auditor-General:

(a) it would prejudice the security, defence or international relations of the Commonwealth;

…   …   …

(e) it would unfairly prejudice the commercial interests of any body or person;

We're none the wiser, as no statement has been made and no account given.

Astoundingly, the reason I'm standing here using an adjournment slot is that for two days we have asked the government's permission to refer this to the Federation Chamber to take note, allowing members to speak on this, and the government has refused. It's a peculiar approach, and it would be reasonable for members to wonder what they're trying to hide. Many would find it difficult to believe that this is really a national security issue, because the Auditor-General is working on defence related projects every day. He is frequently critical of the government and raises value-for-money concerns, yet he has always been able to get his message across to the parliament without disclosing sensitive information. Indeed, draft reports are checked by departments to ensure classified material is not released, yet somehow this report is different to anything in the last 40 years, we're told.

I'm not aware that the Minister for Defence requested a certificate, as occurred in 1987. Perhaps he'll tell us otherwise. Perhaps there are valid reasons. However, the Attorney-General should explain his actions to the parliament and consider a confidential briefing to the Joint Committee of Public Accounts and Audit to assuage concerns. I'm confident that the JCPAA will conduct a public inquiry into this matter; however, the House should take note of this matter, as this looks suspiciously like the Attorney-General has used his power to gag the Auditor-General in order to settle a commercial dispute. There appear to be links between the Attorney-General's actions and a Federal Court case brought by Thales Australia against the Attorney-General. This case was mysteriously withdrawn by consent on 9 July after the Attorney-General issued a certificate on 28 June requiring the deletion of paragraphs which, I understand, Thales objected to. The report appears critical of the value for money that the Commonwealth obtained from Thales for the Hawkei.

The government decided in 2014 to go to a sole-source tender with no competition and a lack of proper benchmarking. Perhaps this will turn out to be for valid reasons, as I said. Perhaps we will never know. Perhaps this will turn out to be a one-off incident, but the matter needs scrutiny and must not be allowed to set any kind of precedent or suggest to the defence industry or any other commercial interest in this country that you can routinely take a court case to, in effect, reduce accountability to the parliament where commercial interests are upset. It is a serious matter, if only to make the point that this can never become routine if the parliament is to function in a Westminster system.