In June 2022 we discussed the Independent Commission Against Corruption (ICAC) forum’s examination into the legality and ethics of pork barrelling in politics. A year later, the NSW Government has passed the Government Sector Finance Amendment (Grants) Bill 2023 (NSW) (GSFA Bill), designed to strengthen government accountability in the use of public funds by Ministers and government staff.
Below we outline the outcome of the ICAC forum, the amendments made by the GSFA Bill and the impact of these changes on NSW Ministers, government employees and agencies.
The ICAC findings
Following the forum, ICAC published a report known as Operation Jersey which outlined its views on pork barrelling and found that although under existing law pork barrelling could amount to corrupt conduct, there is a need to better regulate and prevent the practice.
ICAC examined existing mechanisms regulating the use of government grants, including the Government Sector Finance Act 2018 (NSW) (GSF Act) which sets out values guiding the exercise of financial management functions by a government officer or GSF agency. A key finding in this respect was that the GSF Act contained no direct reference to “value for money”, a probity principle frequently breached by pork barrelling. In response to this, ICAC recommended that an equivalent to section 71 of the Public Governance, Performance and Accountability 2013 (Cth), which regulates proposed expenditure of a Commonwealth Minister, be legislated in NSW.
GSFA Bill 2023
The GSFA Bill was passed by both houses on 25 May 2023 and will commence on 1 July 2023.
The Bill responds to the ICAC recommendation by inserting a requirement into the GSF Act that government Ministers do not approve grants unless they are satisfied that the grant is “an efficient, effective, economical and ethical use of money” and will achieve “value for money”.
Furthermore, the Bill effectively codifies the seven key principles of Grants Administration currently set out in the Grants Administration Guide. While the GSF Act currently prevents Ministers, ministerial staff and government sector agency employees from “knowingly” breaching a requirement contained in the Guide, the Bill creates a positive duty for these individuals to consider the Grants Administration principles when approving or declining an applicable grant.
A person approving or declining a grant must now have regard to:
- robust planning and design in the grants process
- collaboration and partnership with all relevant stakeholders
- proportionality according to the value and complexity of the grant and the associated risks
- achieving outcomes and benefits consistent with government objectives
- achieving value with the relevant money
- governance and accountability
- probity and transparency.
In addition to these tighter controls on the making of government grants, the Bill contains two key changes designed to increase the overall transparency in the grants administration process.
The Bill amends the Government Information (Public Access) Act 2009 (NSW) (GIPA Act) and the Government Information (Public Access) Regulation 2018 (NSW) (GIPA Regulations) to prescribe certain information relating to government grants as “open access information”, which is to be made publicly available free of charge unless there is an overriding public interest against disclosure.
The Bill also amends the GIPA Act and GIPA Regulations to require publication of this information on the New South Wales Government grants and funding finder website.
What these changes mean for Ministers, government employees and agencies
The changes to the GSF Act apply not just to NSW government Ministers, but to any person “approving or declining a grant to which the Grants Administration Guide applies” including:
To ensure their decisions are not open to administrative law challenge, Ministers, officials and ministerial staff must now specifically consider the seven key principles of Grants Administration when approving or declining an applicable grant. Moreover, when approving grants, Ministers must now ensure they address the new requirement that grants are “an efficient, effective, economical and ethical use of money”, and that will achieve “value for money”.
The amendments to the GIPA Act and GIPA Regulations also means that NSW government agencies will need to adapt their existing disclosure and publication practices as necessary to bring them into line with the new requirements.
If you have any questions regarding this article, please get in touch with a member of our team below.
Authors: Greg Wrobel and Colin Taylor
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Publications
Audit Office of New South Wales: Local Government 2022
The Audit Office has assessed and released its findings and recommendations for the local government sector financial statement audit for the year ended 30 June 2022 (13 June 2023). Read more here.
Interim report of the SafeWork NSW Independent Review released
An interim report on SafeWork NSW has been released. The Review headed by Retired Supreme Court Judge Hon. Robert McDougall KC, investigates the effectiveness of the state’s work health and safety body, SafeWork NSW(8 June 2023). Read more here.
Local Government NSW: Parliamentary inquiry into the Housing and Productivity Contributions Bill 2023 submission
The Local Government NSW provided a submission to the Portfolio committee No. 7 – Planning and Environment in response to the Environmental Planning and Assessment Amendment (Housing and Productivity Contributions) Bill 2023 (7 June 2023). Read more here.
Practice and Courts
AAT Bulletin Issue No.11/2023
The AAT Bulletin is a fortnightly publication containing information about recently published decisions and appeals against decisions in the AAT’s General, Freedom of Information, National Disability Insurance Scheme, Security, Small Business Taxation, Taxation & Commercial and Veterans’ Appeals Divisions Cases (5 June 2023). Read more here.
Reissued Practice Note SC CL 02 – Criminal Proceedings
On 2 June 2023, the Chief Justice reissued Practice Note SC CL 2 – Criminal Proceedings, with a commencement date of 12 June 2023. Read more here.
Cases
DN v Secretary, Department of Communities and Justice [2023] NSWSC 595
CHILD WELFARE – Jurisdiction – Children’s Court of New South Wales – Care order – variation – where children outside of New South Wales.
Children and Young Persons (Care and Protection) Act 1998 (NSW) and Interpretation Act 1987 (NSW).
Belle Living Pty Ltd v Randwick City Council [2023] NSWLEC 1282
INTERIM HERITAGE ORDER – appeal against an interim heritage order – interim heritage order made by the Council – the conditions of the Ministerial order authorising the Council to make interim heritage orders are met – appeal upheld.
Environmental Planning and Assessment Act 1979; Heritage Act 1977; Land and Environment Court Act 1979; New South Wales Government Gazette No 484 (Local Government); New South Wales Government Gazette, No 90 and Randwick Local Environmental Plan 2012.
Quarry Street Pty Ltd v Minister Administering the Crown Land Management Act 2016 [2023] NSWLEC 62
Judicial review – Aboriginal land claim – Minister’s decision to grant claim – claimable Crown lands – whether land claimed was lawfully used or occupied – land leased and subleased – whether sublessee’s use of land lawful – whether Minister misconstrued statutory provision or lease in deciding use not lawful – lessee’s submissions objecting to land claim – whether Minister owed lessee procedural fairness to consider submissions – whether Minister shown to have failed to do so.
Aboriginal Land Rights Act 1983 (NSW).
Skyton Holdings No 5 Pty Ltd v Strathfield Municipal Council [2023] NSWLEC 61
QUESTION OF LAW – chair of local planning panel not appointed by Minister administering Environmental Planning and Assessment Act 1979 (NSW) as approved independent person – validity of decision of planning panel to refuse development consent upheld in light of s 52(1) of Interpretation Act 1987 (NSW) – no contrary intention in Environmental Planning and Assessment Act 1979 (NSW) to exclude application of s 52(1) of Interpretation Act 1987 (NSW) in circumstances of case.
Administrative Decisions Tribunal Act 1997 (NSW); Education Act 1902 (UK); Environmental Planning and Assessment Act 1979 (NSW); Interpretation Act 1987 (NSW); Land and Environment Court Act 1979; Legislation Act 2001 (ACT); Local Government Act 1993 (NSW); Medical practitioners Act 1939 (NSW); Medical Practitioners (Amendment) Act 1987 (NSW) and Uniform Civil Procedures Rules 2005 (NSW).
Legislation
NSW Legislation
Regulations and other miscellaneous instruments
Electoral Funding (Adjustable Amounts) (Political Donation Caps) Notice 2023 – published LW 9 June 2023.
Environmental Planning and Assessment Amendment (Fees) Regulation 2023 – published LW 9 June 2023.
Environmental Planning and Assessment Amendment (Sydney Terminal Building (Central Station) Revitalisation Project) Order (No 2) – published LW 9 June 2023.
Point to Point Transport (Taxis and Hire Vehicles) Amendment Regulation 2023 – published LW 9 June 2023
Environmental planning instruments
Bayside Local Environmental Plan 2021 (Map Amendment No 2) – published LW 9 June 2023.
Cessnock Local Environmental Plan 2011 (Map Amendment No 8) – published LW 9 June 2023.
Coffs Harbour Local Environmental Plan 2013 (Map Amendment No 7) – published LW 9 June 2023.
Gloucester Local Environmental Plan 2010 (Map Amendment No 3) – published LW 9 June 2023.
Great Lakes Local Environmental Plan 2014 (Map Amendment No 8) – published LW 9 June 2023.
Greater Taree Local Environmental Plan 2010 (Map Amendment No 3) – published LW 9 June 2023.
Lake Macquarie Local Environmental Plan 2014 (Amendment No 47) – published LW 9 June 2023.
Murray Local Environmental Plan 2011 (Amendment No 15) – published LW 9 June 2023.
Muswellbrook Local Environmental Plan 2009 (Map Amendment No 4) – published LW 9 June 2023.
North Sydney Local Environmental Plan 2013 (Amendment No 34) – published LW 9 June 2023.
Penrith Local Environmental Plan 2010 (Amendment No 41) – published LW 9 June 2023.
State Environmental Planning Policy (Precincts-Eastern Harbour City) Amendment (Larger Erecting Shop-South Eveleigh) 2023 – published LW 9 June 2023.
Willoughby Local Environmental Plan 2012 (Amendment No 33) – published LW 9 June 2023.
Sydney Local Environmental Plan Amendment (Precincts) 2023 – published LW 8 June 2023.
Bathurst Regional Local Environmental Plan 2014 (Amendment No 21) — published LW 2 June 2023.
Cabonne Local Environmental Plan 2012 (Map Amendment No 3) – published LW 2 June 2023.
Camden Local Environmental Plan 2010 (Map Amendment No 3) – published LW 2 June 2023.
Central Coast Local Environmental Plan 2022 (Map Amendment No 7) – published LW 2 June 2023.
Cessnock Local Environmental Plan 2011 (Amendment No 36) – published LW 2 June 2023.
Dubbo Regional Local Environmental Plan 2022 (Map Amendment No 4) – published LW 2 June 2023.
Nambucca Local Environmental Plan 2010 (Amendment No 32) – published LW 2 June 2023.
Narromine Local Environmental Plan 2011 (Amendment No 11) – published LW 2 June 2023.
Tamworth Regional Local Environmental Plan 2010 (Amendment No 26) – published LW 2 June 2023.
Bills assented to
Electoral Funding Amendment (Registered Clubs) Act 2023 No 3 – assented to 8 June 2023.
First Home Buyer Legislation Amendment Act 2023 No 4 – assented to 8 June 2023.
Commonwealth
Act compilation
Biosecurity Act 2015 08/06/2023 – Act No. 61 of 2015 as amended.
Fair Work Act 2009 06/06/2023 – Act No. 28 of 2009 as amended.
Customs Tariff Act 1995 02/06/2023 – Act No. 147 of 1995 as amended.
Bill
Statute Law Amendment (Prescribed Forms and Other Updates) Bill 2023 1 June 2023.