Integrity Commissioner Jaala Hinchcliffe has described the corruption investigation into the multimillion-dollar milestone payments approved by Australian Border Force to arms manufacturer Austal as serious and ongoing in a fiery exchange in a Senate estimates hearing.
Independent Senator Rex Patrick detailed a list of “significant issues” with the fleet of patrol boats made by ASX-listed Austal that were “fundamentally flawed” on Thursday evening.
“The boats were not fit for purpose and Border Force did not want to make the payment,” Senator Patrick said. “Are you aware of the facts I just put to you?”
Ms Hinchcliffe deflected, claiming the investigation was ongoing but eventually said: “If you are asking me – is this a serious matter? Or a serious investigation? Then the answer is yes.”
The Age and Sydney Morning Herald first reported the corruption investigation into the two payments totalling $39 million had been scaled back, including scrapping hearings and standing down counsel assisting, Jonathan Hyde and Dianna Tang.
Ms Hinchcliffe, who became head of the Australian Commission for Law Enforcement Integrity in February, said she was briefed on the legal team’s strategy but a “divergence of views” over the use of further private hearings resulted in counsel leaving the case.
Senator Patrick listed Mr Hyde’s qualifications and said this disagreement “raises concerns in my mind” before alleging that Ms Hinchliffe was influenced by politicians to wind back the investigation.
“I want to be really fair to you, that this has been put to me that someone has leant on you, someone’s put pressure on you and there are so many senior people involved in this that you simply don’t want to go there,” Senator Patrick said.
These comments prompted backlash, including from deputy chair Senator Amanda Stoker who labelled it “slander” and “defamatory”.
“If you had some shred of evidence, you might be justified. Right now, you have done nothing more but abuse parliamentary privilege,” Senator Stoker said.
Ms Hinchliffe rejected the allegations, saying “I am completely independent”.
“I completely reject any allegation that I’ve been in any way leant on or am acting without integrity in relation to this or any other investigation. I take my integrity very seriously.”
Former Court of Appeal judge Stephen Charles has called for a powerful federal ICAC that holds coercive hearings, and criticised the Australian Commission for Law Enforcement Integrity as “hopeless”, partly to do with its small budget. Greens Senator Larissa Waters asked the Integrity Commissioner about this perspective.
“I do not agree ACLEI is hopeless or that we have a lack of will,” Ms Hinchliffe said. “We are working on being able to focus on serious and systemic corruption.”
The commission has never hosted public hearings and Ms Hinchcliffe defended its “judicious” use of private hearings.
“I’m really conscious of the fact these hearing powers are coercive powers. They are an important power within our toolkit, but one of the many powers or tools we have.
“When I use them, I will be using them judiciously and making sure there is a reason that we need to use them to obtain the information we’re looking for.”
Ms Hinchliffe denied she was “reticent” in her approval of private hearings, but said they were costly and can make it harder to launch subsequent civil or criminal proceedings.
Austal is a regular donor to both major parties. In 2017-18, it donated more than $70,000 to Labor and in the year the milestone payments were made (2015-16), it donated $60,000 to the Liberal Party, according to public records. The company is reliant on securing government contracts.
Senator Patrick said Austal had changed its lobbying strategies from donations to hosting dinners and asserted a number of federal politicians had attended – former minister Julie Bishop, Prime Minister Scott Morrison, Trade Minister Simon Birmingham, Attorney-General Christian Porter and Senator Michaelia Cash, among others.
Ms Hinchliff said she was not aware of these dinner parties, but it was not within her remit to investigate. “My jurisdiction relates to allegations of corruption of staff members of law enforcement agencies,” she said.
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