Recommendations to strengthen safeguards against improper influence by government lobbyists were never acted on, an audit has found.

The report also shows that almost 40 per cent of registered lobbyists are former ministers or senior public servants, and reveals how a botched attempt to transfer a list of registered lobbyists from one department’s IT system to another led to a $980 million blowout.

A report by the Australian National Audit Office released last Friday found previous recommendations to review the Lobbying Code of Conduct, made by the ANAO two years ago,  fell victim to a chaotic machinery of government transition and a failure by the two departments involved to take responsibility.

The Code, established in 2008, establishes protocols for engagement between government representatives and registered lobbyists.

At the time of the first review PM&C held responsibility for the Code, but that transferred to the Attorney General’s Department in 2018 subsequent to the recommendations being made.

Protecting integrity of government processes

The aim of the Code is to “promote trust in the integrity of government processes and ensure that contact between lobbyists and government representatives is conducted in accordance with public expectations of transparency, integrity and honesty”.

But a 2018 audit found “improvements could be made to communications, compliance management and evaluation for the Code and the Register”.

(Unregulated lobbying) can lead to undue influence, unfair competition and regulatory capture to the detriment of the public interest and effective public policies.

It recommended a review around awareness of the code, compliance risks and evaluation frameworks, to which PM&C agreed.

The current review found neither PM&C nor the AGD had acted on the recommendations, but instead grappled with technical problems during the transition and quibbled over whose job it was to conduct the review.

The AG department did not implement the recommendations and governance arrangements to oversee implementation were “limited in effectiveness”, it says.

It found there was no strategy to raise awareness of the code and no systematic assessment of compliance risks.  Neither evaluation frameworks nor performance measures were developed.

Technology fail

The audit noted that the handover was beset with technical problems during system migration between PM&C and the AGD in May 2019, including incomplete data migration and misalignment between the systems, which saw the cost of the project almost triple.

“Despite known risks associated with a redeveloped system that had never been used in production, and misalignment between that system and the platform in which it would be housed at AGD, the system was placed online without performing pre or post-deployment user testing, data migration validation or having a back-out strategy in place,” the ANAO says.

Following technological failures in the migrated register, AGD put in place an ‘interim solution’ in November 2019. By December planning was focused on “a more robust long-term IT solution” with the first stage to delivered by April this year at a budgeted cost of $590,000.

The first stage was deployed on May 27 with the AGD saying  a final product is now scheduled for delivery in June 2021, at an estimated total cost of $1.57 million.

The delay in transferring the register IT system from PM&C to AGD also “led to differing views about which department held accountability for the Code and the ANAO recommendation”,  during May 2018 to May 2019.

The AG’s department acknowledged that challenges had been experienced as a result of “significant IT issues” during transferal of responsibility for the register from PM&C to AG.

Risks of unregulated lobbying

The audit says lobbying is a fact of life in the public decision making process.

“However it can lead to undue influence, unfair competition and regulatory capture to the detriment of the public interest and effective public policies” and says regulatory measures are designed to safeguard decision making,” it adds.

The register contains 257 lobbyist organisations and 590 lobbyists working on behalf of almost 1,800 clients.

The audit shows 38 per cent of lobbyists have declared being a former commonwealth representative including a minister or senior public servant.

Eight lobbyists were deregistered in January 2020 because of non-compliance and three breaches of the code were reported between February 2018 and March 2020.