Former defence minister accepts advisory role a little more than a month after leaving parliament

This article is more than 1 year old

This article is more than 1 year old

The former defence minister Christopher Pyne has taken a job with consulting giant EY to help grow its defence business.

The appointment was announced little more than a month after Pyne left federal parliament. Pyne – who has held the defence and defence industry portfolios – joins EY as the firm attempts to capture a bigger portion of Australia’s vast and growing expenditure on defence.

Pyne told the Australian Financial Review he was “looking forward to providing strategic advice to EY, as the firm looks to expand its footprint in the defence industry”.

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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.

Australia is engaged in a massive defence spend estimated at $200bn over a decade, including its new $50bn future submarines project and the $35bn future frigate project.

EY is attempting to build its own defence industry capabilities to win a bigger windfall from that defence spend. Pyne will assist the firm in that effort.

EY has headquartered a defence industry capability in South Australia, led by partner Mark Stewart. It also runs defence work out of Canberra.

“Right now the Australian government is engaged in the largest expansion of our military capability in our peacetime history – $200 billion over 10 years out to 2026 with an ambition to build Australian science, technology, engineering, innovation and industrial capability,” Stewart said.

Stewart said the military spending was leading to an influx of investment by multinationals seeking to win defence contracts, which provided opportunities for EY.

“EY sees a role in helping the industry aggregate but also develop their capability to win and execute on work either in their own right or with primes,” he said.

“Christopher Pyne is also here to help lead conversations about what all states need to do to meet the challenges and opportunities this defence investment will bring.”

Rules can often prevent cabinet ministers from immediately working in an industry for which they have just held portfolio responsibility.

The lobbying code, for example, includes an 18-month cooling-off period for ministers and parliamentary secretaries, and 12 months for senior public servants and military figures. The cooling-off period is designed to stop ministers using inside information or contacts for private benefit.

But the rules, themselves weak by international standards, are barely enforced and don’t apply in many cases.

They would not apply to Pyne, because he is not attempting to work as a registered lobbyist with a professional lobbying firm.

Even if he were to actively lobby the government on behalf of EY, Pyne would not meet the code’s definition of a lobbyist, because he works directly for a corporation, rather than for a third-party professional lobbying firm.

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The former Labor resources minister Martin Ferguson was in a similar situation. He left parliament and soon became the chair of the advisory board to the peak body for the oil and gas industry, the Australian Petroleum Production and Exploration Association. The code did not prevent him from doing so, because working for a peak body does not meet the definition of a registered lobbyist.

The ministerial standards require that ministers do not “lobby, advocate or have business meetings with members of the government” on any matter which they have had official dealings with in the past 18 months.

Ministers are also required to undertake they will not take “personal advantage” of information they were given special access to while in office.

Ministerial standards have no legal power and cannot be enforced in court. They are designed as a guide to ministerial behaviour, enforced at the discretion of the government of the day.