Prime Minister John Howard may as well not have a code of ministerial conduct. If he is not prepared to insist on Warren Entsch’s resignation as parliamentary secretary, the code is not worth anything.
First, Mr Entsch was the half-owner of a company that won a $175,000 government contract. The company, Cape York Concrete, won the contract with the RAAF. The code says ministers should avoid “”any appearance of using public office for private purposes”. There is certainly an appearance here. And that appearance is made more obvious by the fact that Cape York Concrete was the only company asked to tender for the job.
It is not as if the Minister had some shares in a huge blue chip company. This is a small company and such a contract as the one it won from the Government would be bound to improve its financial position and the value of Mr Entsch’s shares.
Secondly, Mr Entsch failed to disclose that he was a director and a company secretary of Cape York Concrete, even if he had declared his shareholding. That failure cannot be dismissed as a technicality. Nor does Mr Howard’s defence that Mr Entsch had no involvement in the running of the company. If what Mr Howard says is true, it indicates that Mr Entsch is not taking his duties as director as seriously as the Companies Law requires. That law requires directors to act diligently in the company’s interest. You cannot act diligently by taking no involvement.
This is perhaps why the code permits directorships of companies where there are only family members, but not of companies with broader shareholding. The law requires the involvement of directors.
Thirdly, Mr Entsch failed to disclose two other directorships of private companies. (And Mr Howard failed to disclose them the day before under parliamentary questioning.) His involvement in one of those companies was such that he called the ANZ Bank “”bastards” for trying to sell a cattle station when overdraft requirements were not met.
Another issue has emerged. The Constitution disqualifies from Parliament people with a pecuniary interest in the Public Service. The RAAF contract might fit that description, though the acting Solicitor-General says not.
The Founding Fathers had a clearer idea of the need to ensure that MPs did not use their position to get financial favour with the Government than Mr Howard does.
Mr Entsch should go.
This case and the ones that have gone before it indicate a need to clear up the position of MPs’ and Ministers’ declaration of interests and their conduct. When the Howard Government took office, it attempted to fulfil two laudable promises. One was a Charter of Budgetary Honesty and the other was a Code of Ministerial Conduct. It laid both of them down with words. In practice, it has gone a long way to fulfilling the Budget charter, but it has failed lamentably on the conduct charter. Mr Howard at first applied the ministerial code strictly, but it quickly became obvious that too many of the new Government’s Ministers had too many interests in companies that had dealings with the Government for the code to be tenable. The code has been revised, both openly in the words and less openly in the way it has been applied.
The time has now come for the Government and the Parliament to deal with the code of ministerial conduct in a similar way as they have dealt with the Budget. There is now a Charter of Budget Honesty Act. It will bind any new Government.
There should be a Ministerial and MPs’ Conduct Act binding on all Governments. There should be an independent body to look a references by either House and make recommendations for removal. Ultimately, ministerial removal must be a matter for the House, but it would be a brave Government that ignored an independent body’s recommendation. And it would be a brave Government that refused to refer an instance such as the Entsch case to an independent body.