Home > Oz Politics > The New Corruption

The New Corruption

May 19th, 2003

Tim Dunlop has some interesting thoughts on a factoid reported by Kevin Drum that Australians are less likely to pay bribes than inhabitants of any other country. (the Finns, though, are said to be the least corrupt).

The closest I’ve ever come to paying a bribe is once when I had to collect a very heavy consignment of household goods from the Sydney wharves and a friendly wharfie forklifted the stuff onto our truck in return for a very modest backhander. (Even in this notorious milieu, I wouldn’t have known what to do if my Dad hadn’t been with me).

Although it’s not relevant, I can’t record resisting that on the same visit I saw a squashed Ferrari. One of a consignment of six it had been accidentally dropped from a great height, compressing its already low-slung profile to a height of about a metre.

In part, my limited acquaintance with bribery reflects the fact that I grew up mostly in Canberra. Until about a decade ago, federal politics in Australia was corruption-free to an amazing extent. Ministers of both parties lost their jobs over minor breaches of customs regulations, and the idea of bribing a public servant was pretty much unthinkable.

Things deteriorated in the later years of the Hawke-Keating government as it became expected that government ministers and senior public servants would move on to high-paying corporate jobs. It didn’t take long for people to work out that a few well-placed favors given out in office could be repaid with interest subsequently, and we’ve recently seen instances of blatant corruption at the ministerial and senior public service levels. (I won’t risk the first blog defamation case by naming names – Australian readers will know who I mean, and others wan’t care).

All of this has been accelerated by reforms (I don’t bother putting scare quotes around this much-abused word any more) which have grafted a US-style patronage system onto a Westminster system of unconstrained executive government. The logical outcome is a system with all the ill-effects of patronage, but without any of the checks and balances. This hasn’t yet come to pass – there are too many old-style public servants, and ministers haven’t yet realised the full extent of their power – but things are getting worse every year.

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  1. Mark
    May 20th, 2003 at 03:51 | #1

    This is something of a bug-bear of mine; here’s my wishlist:

    Firstly, I thought Carmen Lawrence’s idea of banning donations from both companies AND unions was a great idea. So only natural persons should be able to make political donations. It offends me that companies that I am investing in through my super are making donations to parties that I don’t necessarily support. If I think a particular party is better for my investments, I can make that decision for myself. This would equally apply if I was a member of a union.

    I would go further, and set up an Australian Electoral Finance Commission – completely seperate to the AEC – which would be a middleman for all funds raised and spent by political parties. Any donation made to a party would have to not only be registered, but actually pass across the books, of the AEFC. Same with any spending by parties.

    Possibly parties’ funds could be supplemented by some amounts from tax revenue – ideally I wouldn’t want this, but it might be needed to pay for TV ads, etc.

    On the more general issue of bribery/kickbacks, all acts of corporate hospitality for politicians and public servants of any level should be registered and tabled in Parliament every three months.

    Possibly we should do like the New York Federal Reserve does these days. Any time an employee (eg. a bond dealer) is taken out to lunch by a market contact, which of course happens all the time, the Bank employees have to pay their own way.

    And finally, all politicians and public servants should have a golden handcuffs arrangement written into their contracts/oaths so that they were forbidden from taking up employment in a related industry before at least 6 months had passed (maybe less time for less senior staff).

    … well, I can dream can’t I?

  2. Malatesta
    May 20th, 2003 at 10:18 | #2

    In Victoria, home of branch-stackers and factional thugs, the Labor government did a beaut handwaving job with its Inquiry into Corporate Governance in the Victorian Public Sector. A naive dill might have thought this was going to set the underpins for all relationships necessary for government to use private finance.
    Hell, no!
    In view of the prorogation of the Legislative Council and dissolution of the Legislative Assembly on 5 November 2002, the Parliamentary Committees ceased to hold office and all uncompleted inquiries lapsed as from that date.
    Maybe the other States are more advanced, but I doubt it.
    The flight-paths of the fairy godpersons who flit between the Big 4 consultants and public “service” are way beyond the view of taxpayers. Way out in the stratosphere. We should be grateful for such altruistic oversight, and stop complaining about the ways of “business” that we will never understand.
    I’m not cynical, just a bit suspicious that Jim Soorley will take up with KPMG or MIG. 🙂

  3. May 20th, 2003 at 11:07 | #3

    This is somewhat OTT but this post reminded me that years ago, someone told me that bribes/payoffs paid by corporations are allowable as a tax deduction in Germany – so long as they were made outside of Germany (i.e. not used to bribe German officials).

    Does anyone know if this is true of not or just an urban myth?

  4. derrida derider
    May 21st, 2003 at 01:26 | #4

    Bribes are tax deductible business expenses in most countries – the only catch is that the tax authorities generally want to see the receipt!

  5. derrida derider
    May 23rd, 2003 at 11:04 | #5

    Correction – bribes were tax deductible until we signed this in 1999.

  6. derrida derider
    May 23rd, 2003 at 11:07 | #6

    Whoops, lin is here

  7. May 23rd, 2003 at 12:23 | #7

    Thanks derrida, much appreciated.

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