Budget Estimates Hearings 21/08/14: Luke Foley Questions Premier Mike Baird

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GENERAL PURPOSE STANDING COMMITTEE NO. 1

Thursday 21 August 2014

Examination of proposed expenditure for the portfolio areas

PREMIER, INFRASTRUCTURE, WESTERN SYDNEY

The Committee met at 2.00 p.m.

 

MEMBERS

Reverend the Hon. F. J. Nile (Chair)
The Hon. C. Cusack The Hon. G. Pearce
The Hon. L. Foley The Hon. P. Primrose
Dr J. Kaye
The Hon. M. Pavey (Deputy Chair)
The Hon. A. Searle

PRESENT

The Hon. Mike BairdPremier, Minister for Infrastructure, and Minister for Western Sydney

SIMON ARTHUR SMITH, Acting Secretary, Department of Premier and Cabinet


 

CHAIR: I declare the proposed expenditure for the portfolios of Premier, Infrastructure and Western Sydney open for examination.

The Hon. LUKE FOLEY: Premier, do you remain committed to the Liberal-Nationals 2011 election promise to "return planning powers to local communities"?

Mr MIKE BAIRD: Of course we do, yes.

The Hon. LUKE FOLEY: On Tuesday were you in the Hunter Mall?

Mr MIKE BAIRD: Yes.

The Hon. LUKE FOLEY: Are you aware of the planning proposal for the redevelopment of the Hunter Mall that involves three high-rise towers in that part of the east end of Newcastle?

Mr MIKE BAIRD: I am aware there are renewal plans for Newcastle, yes.

The Hon. LUKE FOLEY: Am I correct in recalling that in recent days you have stated publicly that you remain committed to all of the decisions your Government has made with respect to the urban renewal of

Newcastle?

Mr MIKE BAIRD: That is right.

The Hon. LUKE FOLEY: Each and every one of them?

Mr MIKE BAIRD: Obviously, we are committed to the renewal of Newcastle. I do not quite know what point you are getting to, but yes.

The Hon. LUKE FOLEY: Are you aware of the process to date concerning the proposed

redevelopment of the east end of Newcastle?

Mr MIKE BAIRD: That is obviously more for the planning Minister, who is overseeing that process.

The Hon. LUKE FOLEY: Do you have any knowledge of the UrbanGrowth GPT proposed redevelopment for the east end of Newcastle?

Mr MIKE BAIRD: I understand there is a proposal. I understand it is within the planning department. It seems like you are posing questions that should be answered by the planning Minister.

The Hon. LUKE FOLEY: I am asking you, Premier, in light of your visit to the very site two days ago and your public declaration that the Government will move forward with every one of these projects. Do you have any familiarity with the proposed redevelopment of the east end of Newcastle?

Mr MIKE BAIRD: I think the important point is what I committed to at that meeting—and I did not see you there, but maybe you were—that is, the renewal of Newcastle. Now for a long time that community has asked for something to be done. We have obviously been in Government for three years. We have listened to the community, we have listened to all stakeholders and we have taken a decision to renew that city—something that you did not do, something that we have found the money to do—which is going to provide an incredible

opportunity. Newcastle is going to be an incredible city once that renewal is complete, not just in Australia, I genuinely think across Asia-Pacific and indeed around the world. I think you can see the benefits of what comes with urban renewal. On the ground when I was talking to people even this week it is clear—

The Hon. LUKE FOLEY: Indeed Newcastle's name has gone round the region and the world in recent days, Premier, has it not?

Mr MIKE BAIRD: It will be known as one of the most magnificent cities in the world; that is my strong sense. The connection of the beach to the harbour will provide an incredible opportunity. That is not just supported by me; it is supported by a former Labor member, with whom you might be familiar, Jodi, as well former Treasurer Michael Costa.

The Hon. LUKE FOLEY: Are you talking about the rail line in particular?

Mr MIKE BAIRD: The endorsement of the renewal of the city by both.

The Hon. LUKE FOLEY: Are you aware that an agency of your government, namely UrbanGrowth, chaired by John Brogden, has entered into a public-private partnership [PPP] with GPT to redevelop the site you were at two days ago?

Mr MIKE BAIRD: I understand that they are involved in a process. But again, if you have got specific questions or concerns about that issue it would seem appropriate that the planning Minister address them.

The Hon. GREG PEARCE: Point of clarification: The GPT proposal was one of the ones that was put forward several years ago under the former Labor Government, and not only did Labor let it lapse but it also let David Jones close down. Labor has a lot to answer for.

The Hon. LUKE FOLEY: I will be asking for extra time.

CHAIR: The Hon. Greg Pearce does not have to clarify the questions of the Hon. Luke Foley.

The Hon. LUKE FOLEY: Of course you note the advocacy from some for your Government's plans

for Newcastle and it is the case that the former member for Newcastle, Tim Owen, has vocally supported the redevelopment of the Hunter Street mall. That is the case, is it not?

Mr MIKE BAIRD: I know that he has supported the renewal of Newcastle. I am not aware of individual sites as part of that. I am aware of a broad vision and that is consistent with a number of players up there. Indeed, I think the Hunter Development Corporation, when you were last in government, was making recommendations along these lines so you have former Labor members and Treasurers, former government agencies under your control all suggesting that this needs to be done, and a planning process is ongoing, as it should be.

The Hon. LUKE FOLEY: Premier, with respect, I am not talking about the overall strategy or the rail line; I want to deal with the redevelopment of the east end of the city, in particular the site you were at two days ago. Are you aware that in his final newsletter the former member for Newcastle touted more renewal; just the right mix and had a long piece putting the case for the public-private partnership that your Government has entered into with GPT? Are you aware of that?

Mr MIKE BAIRD: I am aware, as I told you, that he was supportive of the renewal of the city, as am I, and as are a huge number of stakeholders and the community. That is what I am aware of, and planning will run through its normal processes, as it should.

The Hon. LUKE FOLEY: Are you aware that the former Lord Mayor of Newcastle, then Councillor Jeff McCloy, has also supported very openly the public-private partnership that your Government has entered into to redevelop the Hunter Street mall on the east end of Newcastle? Are you aware of that?

Mr MIKE BAIRD: I am aware that comprehensive consultation has gone on and will go on and any decisions that you are alluding to will run through the normal planning process.

The Hon. LUKE FOLEY: Are you aware that three weeks ago, in the final days of July, your planning Minister changed the relevant State environmental planning policy so as to facilitate, to allow, a dramatic increase in the height of development in the city of Newcastle? Are you aware of that?

Mr MIKE BAIRD: I am aware that the instrument is to provide more jobs and homes in the city.

The Hon. LUKE FOLEY: And how does that action sit with your stated support for the Liberals and Nationals election commitment to return planning powers to local communities?

Mr MIKE BAIRD: The planning process is ongoing. If you are unhappy with part of the planning process, the planning Minister is doing estimates. I am sure you can ask her.

The Hon. LUKE FOLEY: Oh, I had some fun with her this morning.

Mr MIKE BAIRD: Oh you did. You did that this morning. Okay.

The Hon. GREG PEARCE: You did not really get on to this point, though, Luke.

Mr MIKE BAIRD: Well there you go.

The Hon. LUKE FOLEY: That is because you kept interrupting me.

The Hon. GREG PEARCE: Did I, Luke? You could have asked her this morning

The Hon. LUKE FOLEY: Who in your Cabinet does UrbanGrowth report to?

Mr MIKE BAIRD: Yes, UrbanGrowth does come into Planning, yes.

The Hon. LUKE FOLEY: UrbanGrowth is an agency of government that reports to the planning Minister, is that right?

Mr MIKE BAIRD: Yes.

Mr SMITH: The agency has its own independent governing board but the Act that establishes the agency is under the administration of the planning Minister.

The Hon. LUKE FOLEY: So in other words ministerial oversight of UrbanGrowth is the responsibility of the planning Minister?

Mr MIKE BAIRD: The Minister appoints the board.

The Hon. LUKE FOLEY: Yes, thank you.

The Hon. GREG PEARCE: You might have to help Opposition members here because they are not very good at doing their own homework.

CHAIR: No, Mr Pearce. Do not coach Mr Foley. He can do it.

The Hon. GREG PEARCE: I am trying to help him.

The Hon. LUKE FOLEY: Is it appropriate then Premier that in the case of this redevelopment the developer is an agency of government that reports to the planning Minister and the planning Minister took it on herself to change the planning rules in order to facilitate that development? Do you think that is appropriate?

Mr MIKE BAIRD: I think the planning Minister is exercising her rights and responsibilities, which are wide and varied. Of course she has the capacity to do that. UrbanGrowth is charged with looking for urban renewal opportunities across the city so they are absolutely doing their job. Appropriate consultation must be undertaken. I think we are kind of at the point: have you got a substantive issue to put? What is the concern?

The Hon. LUKE FOLEY: I am asking the questions. Is it right, in your view, that the Minister is both the developer and the policymaker when it comes to this planning proposal? Does that sit right with you?

The Hon. MELINDA PAVEY: Why did you not ask her today?

Mr MIKE BAIRD: Yes, that is a fair point. I was just checking with the secretary. I mean, Landcom has always been in that portfolio; it was there when you were there. I do not know whether you had concerns when that was the case for 16 years—I do not know—but from my point of view there is an oversight, there is an independent board, they are making decisions around urban renewal, as they should. There is a separate planning process, which should be overseen and complied with.

The Hon. LUKE FOLEY: To be clear, Premier, my concern is not with the actions of UrbanGrowth, which is doing its statutory duty in pursuing development opportunities on behalf of the State as it is required to do. The question I am asking is: Do you not see a potential probity issue when the developer is an arm of government that reports to the planning Minister and at the same time the planning Minister, in her own right, changes the planning rules, the Newcastle Urban Renewal Strategy, in order to facilitate the planning proposal brought by UrbanGrowth that was at odds with and in breach of the planning rules? Do you not see a probity issue there?

The Hon. GREG PEARCE: I thought you said GPT was the developer.

The Hon. LUKE FOLEY: It is a public-private partnership.

The Hon. CATHERINE CUSACK: Are you saying the Minister is a developer?

The Hon. GREG PEARCE: Are you saying UrbanGrowth is the developer or GPT?

The Hon. PETER PRIMROSE: Do you wish to ask questions?

CHAIR: Order! Can you let Mr Foley ask his questions?

Mr MIKE BAIRD: If you did not ask the Minister the question this morning—

The Hon. LUKE FOLEY: I am asking you. You were there two days ago and you made a very public commitment as part of your act of atonement to the people of Newcastle that you stood by each and every decision your Government has made for the future of Newcastle, so I am giving you the opportunity now to tell us whether you stand by the actions here where the Minister takes reports from the developer and also changes the planning rules for the developer?

Mr MIKE BAIRD: Well, first, you did not seem to have a problem with that when you were in government; Landcom was part of the same portfolio; they were doing the same thing, so you are raising an issue that you did not seem to have a concern with for 16 years yet all of a sudden you do. Secondly, we are very proud of what we have done for Newcastle and the Hunter compared to you. You absolutely took it for granted, things like the Newcastle inner-city bypass, which sat there year on year waiting to be done. Well, you know what we did—

The Hon. LUKE FOLEY: But with respect, Premier, I am asking about this planning proposal. You set foot on that very site two days ago. I am asking you: Do you remain committed to it and do you stand by all the actions of the Government you lead with respect to that planning proposal?

Mr MIKE BAIRD: I will finish and come to it. I promised to deliver every commitment we made. That includes things like the inner-city bypass, which is a $280 million commitment that you looked at for 16 years but never delivered. We are delivering it. We are going through an urban renewal process and we have committed to it. Appropriate planning processes are being followed and, as you said, UrbanGrowth NSW has a role in that. Ultimately we are committed to the urban renewal process. If you are concerned about individual planning matters, it is interesting that you do did not raise them with the Minister for Planning. I am happy to hear about them.

Mr SMITH: UrbanGrowth NSW was formed from Landcom and some other development corporations which were on the books and which had been for some time. It was also a sibling of the other development corporations that had been established, for example, the Hunter Development Corporation, the Central Coast Regional Development Corporation, Cooks Cove Development Corporation and so on. It was proving very difficult to facilitate urban renewal because so many difficult coordination tasks were required to bring all the infrastructure, approvals and systems into place. It was decided that UrbanGrowth NSW, as a participant in urban renewal, would be a change agent to achieve the overall objectives. It was thought necessary where there were government-owned assets or things that the private sector simply could not do that UrbanGrowth NSW should act as a catalyst. A very deliberate decision was made to have that capacity in UrbanGrowth NSW alongside but separate from the approval process, which is in the Department of Planning and Infrastructure.

The Hon. LUKE FOLEY: I have no quarrel with any of that and UrbanGrowth NSW is doing its job. Can you or the Premier tell me of any other case in which UrbanGrowth NSW has entered into a planning proposal and the Minister for Planning, to whom it reports, has changed the planning legislation to facilitate the development? This is unprecedented, is it not?

Mr SMITH: I think it is something that will be expected to occur dozens of times in the future. The point of UrbanGrowth NSW is to work with sites—

The Hon. LUKE FOLEY: So this is a precedent?

Mr SMITH: The same thing occurs when Landcom does developments. It has to apply for rezonings and gain development consent. That is the way it works.

Mr MIKE BAIRD: As the Secretary said, the usual planning processes apply. Distinct functions are being undertaken.

The Hon. LUKE FOLEY: But you told the Committee that you remain committed to the election promise to return planning powers to local communities. What do you say to the people of Newcastle when the Minister for Planning, with a stroke of the pen three weeks ago, raised height limits from eight to 20 storeys for this site so that three massive towers can be built in the east end of Newcastle. Community consultation led to an agreement that there would be no high-rise development in that area—it would be in the west end. What do you say to the people of Newcastle about that action taken by your Minister?

The Hon. GREG PEARCE: I will clarify—

The Hon. PETER PRIMROSE: Let him answer.

The Hon. GREG PEARCE: The department gave evidence this morning that the maximum was 17 storeys.

The Hon. PETER PRIMROSE: Stop running interference.

The Hon. GREG PEARCE: If he is going to mislead—

CHAIR: Order! Mr Pearce, you cannot clarify Mr Foley's questions.

The Hon. PETER PRIMROSE: He is running interference for the Premier.

The Hon. GREG PEARCE: I am just clarifying—

Dr JOHN KAYE: It is not your role to do that.

CHAIR: Order! Let Mr Foley ask his question.

Mr MIKE BAIRD: The Secretary has answered the question the member asked. There are individual functions and we are not backing away from the planning process in any way, shape or form. The planning process will unfold and project consultation must be undertaken. It is interesting that the member did not raise this with the Minister for Planning this morning. I also make the point—

The Hon. LUKE FOLEY: You are in charge now and you must understand that. I am asking you because you are the boss. You lead the Government.

Mr MIKE BAIRD: That is correct, and I have very capable Ministers who are undertaking their responsibilities very well, including the Minister for Planning. The question that should be asked of you and the Labor Party is what you will do about Newcastle. Will you back the former member and agree that there should be renewal and light rail, or will you sit on the fence like you did for 16 years?

The Hon. LUKE FOLEY: As part of making it right and getting your house in order, as you put it in recent days to the people of the Hunter, will you consider commissioning a short and sharp probity review of the process to date, and in particular to look at the roles of the Minister for Planning and her agency UrbanGrowth NSW in the proposed high-rise redevelopment of the east end of Newcastle? Will you consider that?

Mr MIKE BAIRD: No.

The Hon. PETER PRIMROSE: So much for being sorry

The Hon. CATHERINE CUSACK: What is the allegation?

The Hon. LUKE FOLEY: I am not making any allegations; I am asking questions.

The Hon. CATHERINE CUSACK: Why would he have a probity inquiry when there are no allegations?

Dr JOHN KAYE: Point of order: This is Mr Foley's opportunity to ask questions, not the Government's.

The Hon. GREG PEARCE: We are not asking questions.

CHAIR: Order! No, you are interjecting. Let Mr Foley ask his questions. He has a line of questions and Government members are interrupting him.

The Hon. CATHERINE CUSACK: No, I was responding to Mr Primrose's interjection.

The Hon. PETER PRIMROSE: We are both out of order.

The Hon. LUKE FOLEY: In order to address the widespread concerns of many Novocastrians about this proposed redevelopment—

Mr MIKE BAIRD: In fact, there is wide support for the urban renewal program.

The Hon. LUKE FOLEY: I am talking about this proposed redevelopment and the three 17- to 20- storey towers in the east end, which you visited two days ago. To address the widespread concerns of Novocastrians and, indeed, the Newcastle Herald, about this redevelopment will you consider appointing a retired judge—perhaps David Ipp—to conduct a probity review of the roles of the Minister for Planning and her agency UrbanGrowth NSW?

Mr MIKE BAIRD: The urban renewal strategy was an open process; it was put on public exhibition—

The Hon. LUKE FOLEY: And it was changed three weeks ago with the stroke of a ministerial pen.

Mr MIKE BAIRD: The Minister responded to departmental advice.

The Hon. LUKE FOLEY: Premier, in light of the recent questions, could I turn to one of the other reforms you have enacted in your period in office? You recently amended the Lobbying of Government Officials Act to hand to the Electoral Commission responsibility for the regulation of third party and other lobbyists, did you not?

Mr MIKE BAIRD: Before I answer that I refer to your last set of questions and to the east end development application to which you were alluding. I have been advised that the approval authority for that application or questions on this matter should be directed to Newcastle City Council.

The Hon. LUKE FOLEY: Can we now go to the Lobbying of Government Officials Act? You sponsored some legislation in the Parliament as Premier that transfers the responsibility for the regulation of the lobbyists in this State to the Electoral Commission, did you not?

Mr MIKE BAIRD: Yes.

The Hon. LUKE FOLEY: And that was passed by both Houses in June, was it not?

Mr MIKE BAIRD: Yes.

The Hon. LUKE FOLEY: It has received assent, has it?

Mr MIKE BAIRD: Yes.

The Hon. LUKE FOLEY: Do I understand that it has received assent but it has not yet been

proclaimed?

Mr SMITH: That is right. It is not in effect yet.

The Hon. LUKE FOLEY: The current situation is that the Department of Premier and Cabinet retains responsibility today for the regulation of lobbyists?

Mr SMITH: That is correct.

Mr MIKE BAIRD: While the unit is being established with the Electoral Commissioner.

Mr SMITH: The funding has been provided to the Electoral Commission to establish the role. They are currently building the database and the tools that will be necessary to take on the role and they will also need to be doing some recruitment to have the personnel to conduct the function.

The Hon. LUKE FOLEY: Do you anticipate that the Act will be proclaimed in the life of this Parliament, or will it happen in the life of the next Parliament?

Mr SMITH: This Parliament.

The Hon. LUKE FOLEY: This year?

Mr SMITH: Yes.

Mr MIKE BAIRD: The Electoral Commission is working very hard.

The Hon. LUKE FOLEY: What exactly will be handed over? Are all current records concerning lobbyist activity within New South Wales to be handed over from the Office of the Department of Premier and Cabinet [DPC] legal counsel to the Electoral Commission on or before the Act is proclaimed?

Mr SMITH: Yes. The whole lot.

The Hon. LUKE FOLEY: The whole lot?

Mr SMITH: Yes.

The Hon. LUKE FOLEY: That will include the register of lobbyists and all annual and quarterly paperwork obligations?

Mr SMITH: Yes.

The Hon. LUKE FOLEY: Who exactly is responsible right now for investigating alleged breaches of the lobbyist code of conduct in New South Wales?

Mr SMITH: DPC, and the general counsel is the lead person who is in charge of that function.

The Hon. LUKE FOLEY: Will the records of recent investigations conducted by Mr Eccles and Mr Miller be handed over to the Electoral Commission?

Mr SMITH: Yes.

The Hon. LUKE FOLEY: So you expect that all records relating to the matters I raised with

Mr Eccles and Mr O'Farrell at last year's estimates will be handed over to the Electoral Commission upon the proclamation of the Act?

Mr SMITH: Yes, because the commission will have both a registry function, keeping a list of who is registered, the entities that are registered and the employees, and it will also need the record of the various things that have been done to add and remove people from the registry. You will recall after last year's events changes were made which said that a person could not be both a registered lobbyist and an office holder or the person concerned with the management of a political party. So we had to write to everyone on the register to draw their attention to that fact. We had a process where people were essentially given the choice about which they would rather be and almost everybody promptly made that choice and fell into only one camp or the other.

The Hon. LUKE FOLEY: Almost everyone. Has that matter now been concluded? Has everybody made the choice?

Mr SMITH: Yes. After a bit of delay it is now resolved.

The Hon. LUKE FOLEY: These are the charges announced by Prime Minister Abbott and then the State followed in about October. My recollection is that Mr Eccles told us he wrote to all the registered political parties in New South Wales, as well as all the registered lobbyists, concerning these changes.

Mr SMITH: Yes, I believe that is correct.

The Hon. LUKE FOLEY: So you are telling us that everyone on the lobbyist register who was an office holder of a political party as defined by you has now got their affairs in order to comply with the new requirements of the code?

Mr SMITH: That is right. My understanding is that all of those people were written to and asked to confirm in writing that either they were seeking to be removed from the lobbyist register or they had resigned from their position as an office bearer in a political party. We followed that through with each person. There was, as I mentioned, a slight delay with one person. Everyone else moved—

The Hon. LUKE FOLEY: Who was that?

Mr SMITH: I prefer not to go into detail in relation to that unless it is very important.

The Hon. LUKE FOLEY: No. I take you to your second reading speech. You made some remarks about the establishment of a watch list for the first time. Can you tell us how that new mechanism, the watch list, will operate. In particular, I am interested to learn whether it is directed in the main at third party lobbyists or at other lobbyists who you seek to capture in your new arrangements? I commend you for that. Or is it aimed at both?

Mr MIKE BAIRD: I will let the Secretary answer that but I make the point that we have implemented a longstanding report—it was delivered early in 2010—about these recommendations so we are getting on with the job.

The Hon. LUKE FOLEY: For the record let me say I think it was a good step, a good piece of legislation. However, I am interested to learn how the watch list would work in practice. I know you had your back turned, Mr Smith, but my particular question is whether the watch list is aimed in the main at third party lobbyists, other lobbyists who you are seeking to capture, or both?

Mr SMITH: Essentially, this will be something that the Electoral Commissioner does. When the commissioner forms the view that a person has not adhered to the ethical standards, if the person is a registered lobbyist they would be kicked off the list of registered lobbyists. That would be the first step. If a person who is not a registered lobbyist does not adhere to the ethical standards, then they are the characters who would go on the watch list. So it applies generally. The effect of the watch list is that while Government Ministers and government officials are not ever required to meet with any person generally, in the case of a person who is on the watch list they would be required to take extra special care in having a meeting with that person. That would probably include having additional witnesses in the room or it could be that they may decide not to meet at all with the person who is on the list.

The Hon. LUKE FOLEY: Your answer confirms the Premier's statements in his second reading speech that the primary sanction for registered third party lobbyists will continue to be removal from the register and the primary sanction for other lobbyists—lobbyists other than third party lobbyists—will be this new watch

list. Is that correct?

Mr SMITH: Yes. I cannot be sure but I expect that the commissioner would be able to deal with a registered lobbyist who has not complied with the standards by doing both in one stroke. They could say, "You are no longer registered" and "You are on the watch list". Once they are removed from that list they are a non-registered lobbyist and people in that category can be placed on the watch list.

The Hon. LUKE FOLEY: For third party lobbyists the watch list is not a yellow card and removal a red card. It is the case that the principle sanction for third party lobbyists will be removal. The watch list is not something that would be a sort of halfway house for third party lobbyists who commit misdemeanours?

Mr SMITH: No. If they are not up to standard as a registered lobbyist then they should not be a registered lobbyist. But I think the commissioner would be quite likely to go further than that if he or she discovered that they were not conforming to the standards. Then it would not matter whether they registered or not. People in government should know.

Mr MIKE BAIRD: And he has the discretion.

Mr SMITH: That is right.

The Hon. LUKE FOLEY: So rather than yellow card, red card, the third party lobbyist can be sent off the field and then he would cop an extra suspension by being on the watch list as well, so no-one would ever meet with him. That is what we are looking at, is it not?

Mr SMITH: It could be red card with flashing light on head.

The Hon. LUKE FOLEY: We have moved from cricket to football. I try to pay some attention to the words in second reading speeches because they carry some weight. I refer to the term "interim sanction" for third party lobbyists. To be clear, do I take that an "interim sanction" is something that could occur while the Electoral Commission conducts a thorough investigation of a matter before making a final decision? Is that what you think is meant by the term "interim sanction" for a third party lobbyist in the Premier's second reading?

Mr SMITH: I am afraid I am not certain but it sounds plausible.

The Hon. LUKE FOLEY: Could you perhaps take it on notice?

Mr SMITH: Sure.

The Hon. LUKE FOLEY: —and come back to the Committee with some further advice on what is exactly meant by the phrase "interim sanction" in the second reading speech. I do not think those words appear in the Act, so I am just interested in the thinking and the rationale.

Mr SMITH: Yes, happy to do so.

The Hon. LUKE FOLEY: When can we anticipate a further change to the lobbyist code of conduct to establish the watch list? I beg your pardon, is it intended that the lobbyist code of conduct will be amended to incorporate the establishment of a watch list?

Mr SMITH: Yes, that would be something that the commissioner would do. He is working on now setting up the administrative systems and whether they have them in a revised code or some other notice that went to the public sector and people who are subject to the code would be for him or her to work out. There will be a special position in the Electoral Commission Registrar, whose job is to administer that whole system, and they will be the ones helping to develop all the administrative arrangements.

The Hon. LUKE FOLEY: There will be a registrar—

Mr SMITH: Of lobbyists.

The Hon. LUKE FOLEY: To be clear, there will be a registrar within the Electoral Commission who reports to the three persons?

Mr SMITH: He or she will be one of the commissioners.

The Hon. LUKE FOLEY: He or she will be one of the three commissioners?

Mr SMITH: That is my understanding.

The Hon. LUKE FOLEY: Thanks. This is news to me.

 

Mr SMITH: It is all new. It is not there yet.

The Hon. LUKE FOLEY: Yes, that is why I am asking about it.

Mr MIKE BAIRD: There is also discretion given to the Commissioner over the next 12 months to look at the process and make recommendations on enhancements. We are open to refinements as well. The Commissioner has discretion, and obviously the Department of Premier and Cabinet is liaising directly with them.

The Hon. LUKE FOLEY: That is good to know. Premier, I did ask politely for the Electoral

Commissioner to appear today so I could ask him some questions about this, but I think Natasha was in a mean mood—she said no. I am interested in a supplementary hearing, a non-adversarial forum to ask some questions of the Electoral Commissioner about how he will get this system up and running. I am not asking for any commitments today. I just put that in your in tray.

Mr MIKE BAIRD: We will let him get a final position and then we will organise an appropriate briefing.

The Hon. LUKE FOLEY: In summary, Mr Smith, do you anticipate that one of the three members of the Electoral Commission will act as the Registrar of Lobbyists in New South Wales and conduct all the duties that the head of the Department of Premier and Cabinet has in practise delegated to the department's legal counsel? Do you think that is how it will proceed?

Mr SMITH: Yes, we pass over all of our work in that space to the independent body.

The Hon. LUKE FOLEY: The Registrar will then be required, I assume, to deal with all fresh applications for registration as a lobbyist in New South Wales?

Mr SMITH: Yes, I believe so.

The Hon. LUKE FOLEY: Has budget supplementation been ticked off by the budget committee or the Cabinet—

Mr MIKE BAIRD: Yes, we have given $2.8 million over four years, recurrent, and $400,000 capital. They need to build the IT systems to cope with that as well.

The Hon. LUKE FOLEY: Is that $2.8 million just for the regulation of lobbyists' functions?

Mr MIKE BAIRD: Yes.

The Hon. LUKE FOLEY: Or is it for other functions concerning the Election Funding Authority?

Mr MIKE BAIRD: No, solely that.

The Hon. LUKE FOLEY: The amount of $2.8 million over four years to regulate what lobbyists get up to in this State?

Mr MIKE BAIRD: Yes.

The Hon. GREG PEARCE: Plus $400,000.

Mr MIKE BAIRD: Yes, plus $400,000 capital, which is the database.

Mr SMITH: It is a much more significant undertaking than simply a registration system for third party lobbyists. There will be quite a bit of activity that relates to other people who seek to lobby government who are not and need not be registered.

Mr MIKE BAIRD: I think the idea of a briefing is important because the whole sense of this is to try to get bipartisan support into these changes. I am pleased you are keen to do that, so we will organise that.

The Hon. LUKE FOLEY: Have you Mr Smith, Mr Eccles or legal counsel of the Department of Premier and Cabinet had cause to investigate any other registered lobbyist since the Tannous investigation that I kicked off last year?

Mr SMITH: I have not in my period of Acting Secretary, but I can take it on notice to let you know if there was anything prior to that time.

The Hon. LUKE FOLEY: Mr Smith, a provision of the lobbyists' code of conduct required that a registered lobbyist keep "strictly separate" his or her lobbying activity and his or her political activity. How is that monitored in light of the fact that several registered lobbyists are well-known political operatives from the Labor and Liberal parties and The Nationals? How is that requirement monitored in practice by your department?

Mr SMITH: It is important to recognise that the code applies not only to the lobbyists but also to those who are met by the lobbyists.

The Hon. LUKE FOLEY: Who are lobbied?

Mr SMITH: That is correct. We obviously cannot attend every meeting that every lobbyist has with every person, so our system is based on investigating any complaints or reports that we receive.

The Hon. LUKE FOLEY: From government officials?

Mr SMITH: From anyone who has been lobbied and who feels that the lobbyist has stepped outside his or her proper role.

The Hon. LUKE FOLEY: Or from anyone else—a member of Parliament, for example. I raised some matters concerning a registered lobbyist at last year's estimates and that was investigated. Is dealing with matters that are brought to the department's attention in practice how you oversee compliance with that requirement?

Mr SMITH: That is right, and also regular reminders through the public sector to remind people that the code exists. For example, we train people and we have departments train their people so that when an assistant to a secretary is asked to have a meeting he or she asks whether the person is a lobbyist. People are trained to advise and record when a lobbyist has been in a meeting.

The Hon. LUKE FOLEY: Premier, given your clear statement, when you introduced amendments to the lobbying Act in June, concerned your determination to restore confidence in our political system, you would insist on the strict separation between lobbying activities of the lobbyist and political activities being strictly honoured, would you not?

Mr MIKE BAIRD: Obviously there is the capacity within that, as the Secretary said, in the definition. If you are asking whether someone can be a member of a party or running the party—

The Hon. LUKE FOLEY: No, they have to keep the activities strictly separate—that is the obligation. You would be very strongly supportive of that as far as Liberal lobbyists are concerned, as I would be as far as Labor-aligned lobbyists are concerned. We are as one on that, are we not?

Mr MIKE BAIRD: Yes.

The Hon. LUKE FOLEY: Mr Smith, has the department allocated any resources to overseeing the activities of First State and Mr Joseph Tannous since the director general found a breach of the code of conduct in September last year?

Mr SMITH: As I said, I am not aware of specific proactive investigations since I commenced as the Acting Secretary, but I am happy to take that on notice for the earlier period.

The Hon. LUKE FOLEY: Does a finding—to my knowledge the first in the life of this

Government—that the code of conduct has been breached not lead to some degree of keeping an eye on this fellow?

Mr SMITH: Yes, it would to some degree.

The Hon. LUKE FOLEY: You will get back to us with some information on how your department has kept an eye on this character since your predecessor found he had breached the code of conduct?

Mr SMITH: Sure, I would be happy to take that on notice.

The Hon. LUKE FOLEY: The NSW Aboriginal Land Council is a client of Mr Tannous' lobbying firm. I have been provided with board papers from the Aboriginal Land Council that state that First State, Mr Tannous' firm: … facilitated attendance of NSWALC staff at a local MPs fundraiser event in Drummoyne (John Sidoti MP). … The fundraiser was a local MPs fundraiser and it perhaps would have been more appropriate for NSWALC to attend state level functions, rather than local MPs functions that were aimed at receiving donations from local business owners. In light of this, will you investigate whether Mr Tannous and his firm were complying with their obligations under the Lobbyist Code of Conduct to keep strictly separate their lobbying and political activities?

Mr SMITH: Sure. We ask people to send us any information they have that would suggest anything untoward in lobbying activity. We would gladly look into it.

The Hon. LUKE FOLEY: Would you be prepared for me to furnish you with some information at the conclusion of this hearing? Would it be an acceptable process for me to provide you with material that has come into my possession?

Mr SMITH: Sure.

The Hon. GREG PEARCE: And you will include the purported minutes in that material you have referred to.

The Hon. LUKE FOLEY: I am happy to discuss with the Committee whether you want them tabled. I have no objection to that, but in the first instance I think Mr Smith and I have agreed on a way forward.

The Hon. CATHERINE CUSACK: Is there an allegation?

CHAIR: The Hon. Luke Foley is asking questions.

The Hon. LUKE FOLEY: I also ask you to investigate the activities of First State and Mr Tannous with respect to Auburn City Council, given that Auburn City Council was a client of the firm on the register of lobbyists last year; given that I have a report from that level of government, Auburn City Council, about the activities of First State on their behalf; and given that—

The Hon. GREG PEARCE: Point of order: I think we have allowed the upper House Leader of the Opposition some flourish with his estimates questions. If he has a series of allegations the appropriate course is not to air them at an estimates committee without due opportunity for those who are being accused to respond. If he wants to give them to the Acting Secretary and the Premier, that is fine. Other than that, he needs to go through a proper process with this Committee, which would be to provide copies of all the documents to all the members and to give everybody an opportunity to look at these things. He has had a fair run. If he wants to give things to the Acting Secretary he should do it.

The Hon. LUKE FOLEY: To the point of order: Time is short. I am simply placing on the record that I would like the Acting Secretary to investigate matters with respect to the First State lobbyists.

The Hon. GREG PEARCE: You have done that.

The Hon. LUKE FOLEY: I have done that. The Acting Secretary has agreed to look at both those matters and investigate them. I will move on.

Mr MIKE BAIRD: He will receive the letter and determine whether he needs to investigate. I think that is the best way to describe it.