Senate committee says investigation into former ministers Julie Bishop and Christopher Pyne was flawed and should be reopened

This article is more than 1 year old

This article is more than 1 year old

A Senate inquiry has called for the reopening of an investigation into the former ministers Julie Bishop and Christopher Pyne taking industry jobs connected with their portfolios, saying the initial probe had failed to ask “crucial questions”.

The Senate inquiry into Bishop and Pyne’s post-political appointments delivered its report on Thursday, urging that the incoming secretary of the department of prime minister and cabinet reopen an investigation into whether ministerial standards were breached.

“The committee recommends, in light of the new information uncovered by the inquiry and media reporting, the prime minister should request the incoming secretary of his department to reopen the investigation of Mr Pyne and Ms Bishop to determine if they have breached the statement of ministerial standards,” the report said.

Bishop, foreign affairs minister until August last year, accepted a job with Palladium, one of the biggest foreign aid contractors in Australia.

Pyne, the former defence minister, took on a role with consulting giant EY to help it capture a bigger slice of Australia’s growing expenditure on defence.

Julie Bishop's job with Palladium caught Dfat by surprise Read more

Ministerial standards prevent former ministers from lobbying or holding business meetings with members of the government, parliament, public service or defence force on any matter for which they held ministerial responsibility for 18 months after leaving parliament. They also require ministers not to use information they have obtained in office for private gain.

An earlier investigation by then department of prime minister and cabinet secretary, Martin Parkinson, found no breach of the standards. But the Senate inquiry was scathing of the initial investigation, saying it suffered from numerous deficiencies.

The committee found the initial investigation by Parkinson was not “particularly extensive”, relying largely on a single phone call each to Pyne and Bishop, without any contact with Palladium or EY.

It was also not treated as a priority, did not ask “crucial questions” about how conflicts were to be avoided, and failed to reconcile inconsistencies clearly on the public record.

The initial investigation also failed to scrutinise whether Pyne and Bishop’s “personal conduct is consistent with the dignity, reputation and integrity of the parliament”, a requirement of the ministerial standards.

“The committee does not believe that the deficiencies in Dr Parkinson’s investigation reflect in any way upon him,” the report said. “The committee is confident that Dr Parkinson did the job the prime minister expected him to in the manner expected by the prime minister. The problem lies in the prime minister’s expectations.”

The ministerial standards are generally considered to be weak. They carry little or no punishment for those who have already departed parliament, and are enforced largely at the whim of the government of the day, not by any independent authority.

The crossbench senator Jacqui Lambie warned there was a disconnect between what the “public sees as dodgy, but the rules and the ruling class sees as totally acceptable”.

On Thursday Lambie called for a gardening leave scheme for departing politicians to be introduced. The scheme would require politicians to stay out of business for a specified cooling-off period, while supporting them with public funds.

Those who break the ministerial standards would be compelled to pay parliament back their gardening leave allowance.

“This isn’t about giving ex-ministers sit-down money,” Lambie told Guardian Australia. “It’s about saying, we’re restricting your ability to do business because you doing business isn’t in the public interest.

“You’ve got to give reasons to abide by the rules after they leave politics. If they don’t have skin in the game, they don’t care if they break the rules.”

The Greens, meanwhile, have called for a five-year cooling-off period, with breaches punished by cuts to political pensions.

“The risk of losing their parliamentary pension will have a remarkable impact on focusing ex-ministers away from feathering their own nest and towards opportunities with less conflict-of-interest potential,” the Greens democracy spokeswoman, Larissa Waters, said.

Government senators issued a dissenting report, describing the inquiry as a “partisan exercise” that was unable to uncover anything new.

“In conducting this inquiry, the committee failed to unearth any evidence of wrongdoing or to make a coherent case as to how the ministerial standards have been breached,” they said.

Both Pyne and Bishop have consistently denied any suggestion that they were in breach of the standards. The pair said they were well aware of their obligations and intended to comply.

Bishop had argued in a submission to the inquiry that the standards would be more workable if the onus was placed on current government officials not to meet with former ministers for 18 months.

“The onus could and arguably should be placed upon current serving officials to not hold meetings with former ministers for the period of 18 months after those ministers cease to hold office,” Bishop said.

Freedom of information documents show Bishop’s former department had no idea she was about to be appointed to one of their biggest contractors.

Other documents produced to the inquiry show Pyne met with EY while he was still defence minister to discuss a post-politics role. Pyne said he was well within his rights to do so.

Julie Bishop says onus should be on serving MPs not to meet with retired ministers Read more

“Having a meeting with EY about a future job doesn’t breach the ministerial standards because I wouldn’t have been needing to divulge any information to them that isn’t publicly available and I wasn’t lobbying or advocating or having business meetings,” Pyne told the inquiry earlier this month.

Bishop’s time in office was marked by a significant increase in the use of for-profit contractors to deliver Australia’s foreign aid program.

About 25% of Australia’s aid spend went to private firms in 2016-17, and the funds were largely shared by 10 major foreign aid contractors. Palladium won the third most contracts of any firm, winning work worth $99m, or about 2.8% of the government’s entire aid spend.

Pyne’s new firm, EY, is similarly attempting to capture a bigger portion of Australia’s massive defence spend. Australia is engaged in major defence expenditure on projects like the $50bn future submarines project and $35bn future frigate project.

The consulting giant already makes enormous profit from its work for the Australian government.

Tender records show in the past four years it has won 838 contracts worth $377m. That includes 138 contracts with the defence department, worth $148m. More money still is available to EY through consulting for other corporations, to help them win and complete government contracts.