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Public Interest Disclosures

Public Interest Disclosures

Advice on legislation or legal policy issues contained in this paper is provided for use in parliamentary debate and for related parliamentary purposes. This paper is not professional legal opinion.
Briefing Paper No. 5/2009 by Jason Arditi

Whistleblowers are seen as central to promoting Government transparency and democratic accountability. With their knowledge and insights into various aspects of public administration, they are able to cast light on issues that might otherwise remain in darkness.

In New South Wales, the Protected Disclosures Act 1994 (NSW)(‘the PDA’) is the primary statute with respect to whistleblowing. Passed in 1994 at a time when a suite of other legislation relating to the modernisation of public administration came into effect, the PDA is designed with three core objectives in mind. The first is to build upon established procedures to create a protected disclosures framework. The second is to provide a range of protections for whistleblowers from retaliation they may be otherwise be subjected to. The third is to ensure that the allegations raised by the whistleblower receive a proper investigation.

In New South Wales, disclosures can be made relating to three key themes. The first of which is corrupt conduct, defined by the Independent Commission Against Corruption Act 1988 (NSW) and entailing a wide range of actions, including bribery, embezzlement and fraud. Disclosures concerning corrupt conduct can be made to ICAC, which is charged with investigating the allegations raised.

The second theme is maladministration, defined as any action contrary to law, unreasonable, unjust, oppressive or discriminatory or based on improper motives. Disclosures concerning maladministration can be made to the Ombudsman in accordance with the provisions of the Ombudsman Act 1974 (NSW), which has the authority to investigate the matter.

The third theme is serious or substantial financial waste of public monies. This may refer to the inefficient or unnecessary spending or the misappropriation of funds. Disclosures concerning serious and substantial financial waste can be made to the Auditor-General in accordance with the provisions of the Public Finance and Audit Act 1983 (NSW).

The PDA also provides for complaints that can be made about police and local government authorities to be made to the Police Integrity Commission and Director-General of the Department of Local Government respectively.

Each agency must take appropriate steps to keep the whistleblower informed of the progress of the investigation into their allegations.

A chief criticism of the PDA is its limited remit. Specifically, the PDA does not provide an avenue for complaints to be made about risks to health, public safety or the environment, despite the public interest in allowing for disclosures of this nature.

To attract the protections afforded by the PDA, only a public official can make a disclosure. Although the delineation between public official and non-public official can sometimes be hazy, such as the role of contractors, generally speaking only those internal to the operation of public administration are able to be whistleblowers.

Disclosures can be made to any of the abovementioned investigating authorities or relevant officials in a public authority. Additionally, disclosures can be made to a Member of Parliament or journalist, although a strict set of criteria that must be complied with before this can take place.

When making a disclosure to an investigating authority, whistleblowers must overcome a legal threshold. Specifically, a whistleblower must show or tend to show that a public authority has, is or proposes to engage in corrupt conduct, maladministration, or serious and substantial waste. The objective nature of this test means that the subjective mindset of the whistleblower is not a material consideration, notwithstanding their good intentions. This is because the intentions and genuine beliefs of the whistleblower are not considered to advance the public interest should their beliefs prove to be mistaken.

This high threshold has been criticised for the onerous hurdles it requires whistleblowers to overcome and an alternative, supplementary test has been recommended. Specifically, this test would allow a whistleblower to attract the protection of the PDA if the whistleblower has an honest belief on reasonable grounds that the disclosure concerning corrupt conduct, maladministration or serious and substantial waste, is true.

Meanwhile, before a public official can whistleblow to a Member of Parliament or a journalist, an even higher threshold must be overcome. Namely, the whistleblower must have reasonable grounds for believing that the disclosure is substantially true and the disclosure itself must be substantially true.

Central to the success of the whistleblowing process is providing whistleblowers with a range of protections. These protections can be summarised into two parts. The first concerns protections against reprisals and, as such, taking retaliatory action in the workplace against someone for whistleblowing is a criminal offence under the PDA. The second protection is indemnifying whistleblowers from any legal liabilities or civil claims they may be subject to, resulting from their whisteblowing. Although these protections go some way to mitigate the damage that may arise out of whistleblowing, and may also remove some of the disincentives to whistleblowing, these protections have been criticised for not going far enough. Allowing injunctive relief against reprisals and creating an actionable tort for whistleblowers who have suffered detrimental action are two further protections that have received widespread support.

There are also numerous examples discussed where protection is expressly not provided for, such as frivolous or vexatious allegations or when it is driven by personal grievances.

The PDA provides some room for allowing the identity of whistleblowers to remain anonymous, although this is not an absolute right. The art is to balance the confidentiality of the whistleblower with the procedural fairness rights of the accused, together with public policy considerations of removing the disincentives to whistleblower whilst ensuring natural justice is achieved.

There is also discussion about the limited ability to evaluate the success of the PDA. This emerges from the fact that, as the PDA is an ‘orphan’, there is no central oversight body that can monitor its operations. There is limited data on the frequency of whistleblowing. Due to the lack of statutory requirements for agencies to report such matters and the absence of any such regulations under the Act, information on the relative success or shortcomings of the PDA and the whistleblowing process generally is scant.

Many of the matters that are reported in the media are revealed anonymously. To this end, journalists form an important role as the watchdog of misconduct by giving light to deficiencies in public administration. In doing so, however, there may be a litany of public service and secrecy provisions that a whistleblower has breached, if reporting the matter was not in strict accordance with the PDA. As such, proceedings may commence in both criminal and civil cases in which journalists are compelled to reveal the identity of their source. As the requirement to reveal a confidence is in fundamental breach with the media code of conduct, many journalists have explicitly refused to reveal their source. In claiming privilege, the Courts have historically been unsympathetic, viewing journalists’ duty as little more than a self-ascribed right without authority.

In New South Wales, however, an amendment to the Evidence Act 1995 (NSW) has allowed for the existence of privilege between journalist and source, but vests discretion in the Court when deciding if such privilege should apply. However, there is limited case law on this provision and exploration of the boundaries of this privilege is ongoing.

There are many arguments in favour and against the existence of a ‘shield law’. Proponents argue that a shield law would further facilitate the disclosure of information relating to deficiencies in public administration, which can bring about positive change. Arguments against concern the denial of natural justice to those adversely affected by the whisteblowing insofar as an accused person would not have access to legal recourse if they are not aware of their accuser. The absence of procedural fairness, together with protecting the identity of the whistleblower, also raises questions of how legitimate and fair the allegations are.

Protected disclosures and shield laws form an interesting part of public administration law. Without these mechanisms, many important issues – and indeed scandals – would have never come to light, and many fundamental changes may not have occurred.