A system Eddie Obeid would love

Many federal politicians don't declare their private interests, fail to fully disclose them, or don't do so in the required time, and the officials who manage the interest registers say it's not their job to enforce the rules. Open Politics looks at a disclosure regime that only serves politicians.

By Sean Johnson
2 May 2022


Berrima Jail librarian Eddie Obeid in happier times. The corrupt former NSW Labor minister is serving time for rigging a coal exploration tender to benefit his family's secret property and mining interests. Photo Paul Miller/AAP

It’s a system Eddie Obeid could have designed. But you wouldn’t know it from first glance. 

The Members’ and Senators’ Interests Registers were established decades ago to reduce the risk of misconduct and corruption by requiring parliamentarians to declare any interests which could conflict, or be seen to conflict, with their public duties. 

After every election MPs and senators are required to complete a detailed form with 14 interest categories known as a Statement of Registrable Interests. 

Among other things, they need to list their assets, private income, debts, as well as directorships, memberships, and any gifts, sponsored travel and hospitality. The interests of partners and dependent children need to be declared too. 

If an MP or senator knowingly provides false or misleading information to the registers, or knowingly fails to declare their interests and changes in a timely manner, they can be found guilty of serious contempt of parliament and dealt with accordingly. So far so good.

Then it all starts to fall apart.

No disclosure, no problem

Parliamentarians get to decide whether an interest needs to be declared. While the House of Representatives and Senate have guidelines to assist parliamentarians with their disclosure statements, there is no rule that says an interest must be declared. 

Take this excerpt from the Senate handbook Registration of Senators' Interests

"It is the responsibility of individual senators to interpret the resolutions and to determine which of their interests fall within its terms, rather than relying on external advice about what ‘should’ or ‘should not’ be declared … In the end, each senator must make his or her own decision as to interests which fall within the terms of the resolutions."

The House of Representatives adopts a similar approach, with the Registrar of Members’ Interests informing Open Politics the office can only provide guidance to members on the requirements of the register.    

We recognise there are going to be grey areas about whether a low value asset like an old second hand car needs to be declared. But for substantial interests like a house you would think it needed to be declared in all circumstances. 

No, in the bizarro world of federal politics MPs and senators get the final say on whether their house or investment property falls within the interest category ‘Real Estate’. Or if their overseas junket and free tickets to sporting events qualify as ‘ Hospitality’ that needs to be disclosed.  

It’s akin to the Australian Tax Office allowing taxpayers to decide what portion of their income needs to be declared.   

This is not a theoretical risk. As revealed by the Sydney Morning Herald in 2021, anti-vax MP and ivermectin ingester Craig Kelly bought a $1.3 million family residence in April that year and didn’t bother to declare it to the Members' register. 

Deputy Opposition Leader Richard Marles was recently caught out for not declaring his 2019 trip to China, which was part funded by think tank China Matters.  

Marles’ fellow junketeer LNP MP Ted O’Brien declared his China trip, but he’s normally one of the parliament’s worst offenders, having failed to declare shareholdings in ten companies and two loans in the last parliament (2016-2019).     

We also have doubts about whether all parliamentarians have declared their complimentary membership of the luxury Qantas Chairman's Lounge, as detailed in an earlier article

Meaningless disclosures

Another shortcoming is that parliamentarians can get away with not declaring all necessary details about their interests. 

Who can forget Christian Porter’s refusal to disclose the parties that helped fund his legal fees in a defamation case and the failure of the House privileges committee to force him to do so. 

Not so publicised is Queensland Independent Bob Katter’s laughably vague disclosure statement where the MP notes he has 'may have some interest in cattle . . . [and] use of a private aircraft from time to time, sometimes during election campaigns - probably not happening these days.” 

He is even more guarded about his wife’s interests, stating in the shareholdings section that “she does not provide me with this information - regards this as personal business and I respect her wishes in these matters.” 

Mad Katter is quite the feminist. 

Then there’s Deputy Prime Minister Barnaby Joyce, who declared a private charter flight from Armidale to Brisbane in May 2021 without disclosing who paid for the flight.

Or the Liberal Member for Wentworth Dave Sharma, who disclosed two tickets to a U2 concert in 2019, a family ticket to Shrek: The Musical in 2020, and two tickets to the opening night of Hamilton at the Lyric Theatre in 2021 without revealing who paid for the nights out.    

The same for Liberal Senator Jim Molan, the recipient of bottles of Cabernet Sauvignon and Chardonnay from a mystery benefactor in October 2021.  

All these declarations have a veneer of transparency, but they are meaningless because the public is not given enough information to assess whether conflicts of interest exist. 

We contacted all four seeking further information, and none replied, although Senator Molan did update his statement to disclose the free bottles of plonk were from Rafael Australia, a joint venture between Australian defence company Varley and Israeli government-owned Rafael Advanced Defence Systems. 

As for who provided those free tickets to Dave Sharma for the opening night of Hamilton, it could be the scandal-plagued Star Entertainment Group as the casino operator provided tickets, at $250 a pop, on the same date to his Liberal colleague Fiona Martin. Liberal MP Trent Zimmerman scored free tickets from Star as well. 

Star may also have forked out for the Sharma family to see Shrek as the musical was held at the Lyric Theatre in the Star casino complex, but we’re seeking clarification from his office. 

Incomplete disclosures

Each of the 14 interest categories in the disclosure forms has specific fields that need to be completed.

For trusts and nominee companies, parliamentarians need to disclose the name of the trust or company, the nature of its operations, and the beneficial interest. 

For real estate, the location needs to be listed along with the purpose for which it is owned. And so on for the other 12 interest categories. 

However as the table below shows, a fair few MPs and senators have left fields blank. Some are minor oversights - e.g. not disclosing which bank issued a credit card or the location of a house - while others are more problematic, such as Labor MP Jim Chalmers neglecting to declare his mortgage creditor and Liberal MP Andrew Laming not detailing the nature of his family trust's operations or the beneficial interest. 

Open Politics inquired with the registrars as to whether they follow up with those who do not complete all fields. 

The Registrar of the Members’ Register said the office does not ‘routinely follow up with members unless there are obvious errors in what they have submitted’ and stressed that ‘it is a matter for members to ensure that they comply with the requirements of the register.’

The Registrar of the Senate Register gave a similar answer, advising that while there are guidelines to help senators complete their disclosure statements,  ‘the final decision [on what is disclosed] lies with senators.’

Open Politics contacted these MPs and senators to ask for more information, and some replied and updated their statements, as per the blue text. (Jim Chalmers' and Brendan O'Connors' offices responded too but have yet to update their statements.)

Late disclosures

Statements of registrable interests must be provided to the registers within 28 days of an MP or senator being sworn into parliament, and any alterations during the parliamentary term need to be declared within 28 days for MPs and 35 for senators. 

Unfortunately some MPs and senators don’t seem to have got the memo.  

Retiring Labor MP Joel Fitzgibbon established a new company 'Fitzgibbon Advisory' in September 2021 but didn’t get around to declaring his shareholding and directorship in the entity until 3 March 2022, at least 126 days late

In his letter to the Registrar Fitzgibbon makes a grovelling apology for the oversight and thanked the office for its ‘wonderful support over the course of the past 26 years. Smooth operator.  

Liberal Senator James Paterson didn’t bother with such niceties when he was 52 days late declaring hospitality from Sportsbet for Oaks Day (4 November 2021) on 30 January 2022 . 

Neither did Craig Kelly, who declared his new house near Gosford over 200 days late and only because of the Herald’s expose of his non-disclosure.

Under House and Senate rules, if someone knowingly fails to declare their interests and changes in a timely manner, they can be found guilty of serious contempt of parliament and dealt with accordingly.

But when Open Politics highlighted these apparent breaches to the registrars they said that it’s not within their powers to do anything. 

The Senate Registrar stated “it is up to individual senators to raise issues for consideration” by the Senate Standing Committee of Senators' Interests, while the House Registrar said “any investigation concerning the registration of Members’ interests would be undertaken by the House Committee of Privileges and Members' Interests [and that] the committee can consider matters referred to it by the House, or specific complaints received from Members of the House.”

In layperson's terms, this means politicians pretty much police themselves.

While the Coalition and Labor often dig up dirt on each other over undeclared interests, they tend not to seek formal investigations into alleged breaches for fear the other side will do the same over other matters.

And even if someone is unlucky enough to be investigated, they don’t have much to fear judging from the House privileges committee’s inadequate inquiry into Christian Porter’s blind trust.  

Reform

So what’s the solution? We could start by electing people who take their disclosure obligations seriously. Those like Helen Haines, Concetta Fierravanti-Wells, and Jason Claire, all of whom provide detailed disclosure statements that comply with the letter and spirit of the registers. 

To catch those who are less transparent Open Politics recommends changes to the House and Senate resolutions and guidelines for the interest registers to require MPs and senators to declare significant or high value interests in all circumstances, both for them and their partners/spouses and dependent children. Their discretion would be removed.

We would like to see an obligation on parliamentarians to provide sufficient information in their statements to allow the public to assess conflicts of interest. That would mean, for example, that when someone receives a gift or free travel and hospitality, the provider of the benefit would need to be disclosed. (Our preference is to ban gifts, sponsored travel and hospitality, but as an intermediate step the public should at least have the right to know who’s providing a benefit.)

The registers’ electronic lodgement system for disclosure statements should also be overhauled to automatically reject statements with missing information in required fields. 

And the register needs to be taken out of the hands of politicians by establishing a statutory body like the Independent Parliamentary Expenses to enforce compliance on misleading, false, and late disclosures.

That’s a system the Eddie Obeids of this world would not love so much.

Trusts and nominee companies

Real Estate

Directorships

Liabilities

Saving or investment accounts

Gifts

Travel or hospitality