Cosy opaque deals with business don't fit 21st century standards

Penny Mayes

The dust up over the mistaken release of some documents concerning car industry subsidies to the Australian Financial Review is still before the Supreme Court. The court is unlikely to examine the decision under the Freedom of Information Act to refuse access to certain documents that the AFR reports were claimed exempt on grounds that disclosure would damage international relations or involve release of  information obtained in confidence from the car manufacturers.

It isn't clear what the agency released, withheld and then in error gave the AFR. Regardless of whether the decision was in accordance with the exemption provisions of the act, a broader issue about transparency regarding the use of public money warrants discussion and debate. Put simply, those who receive large slabs of public money should be required to agree as a condition that the amount, the reasons for the payment and the anticipated returns will be made public.

The issue is getting a run in the business pages of Fairfax papers but deserves wider consideration. It probably won't get it at the top end of town where for years business lobbies have sat out discussion of accountable and transparent government only to chime in occassionally to argue the importance of protecting from disclosure the very sort of information Holden, Ford, and Toyota are keen to protect in this case.

 Bill Scales a former chairman of the Industry Commission and one time chairman of the Automotive Industry Authority wrote in the AFR last week that the case raises issues about the way that we want to be governed into the 21st century.

It’s about the right of Australian citizens to know, and the responsibility of governments to disclose, the actual level of specific industry assistance provided to these three companies. And importantly, what Australia can expect to receive in return from devoting a very large amount of scarce taxpayer funds to these three companies, rather than to some other national priority...
One element of our rapidly changing world is the desire for greater transparency in public discourse. We are living at the beginning of an open access world where the availability of reliable information is seen as an important characteristic of good government, governance and public policy. And yet in relation to company-specific industry handouts, Australia is operating in a schizophrenic political and policy environment.
Australian public policy should be changed so that firms receiving company-specific subsidies should agree that all information about the amount of any subsidy, the rationale for the subsidy and the likely economy wide benefits from the provision of the subsidy will be made public....
The importance of this dispute between the Financial Review and the federal government about the control of information goes beyond debates about freedom of information and industry policy. It goes to the very heart of how we want to be governed, now and in the future. Australia in the 21st century should have a strong bias towards, and a culture of, disclosure and transparency in all of our public discourse. We are part of the way there with our approach to some elements of public policy, such as education and health, but light years away from this ideal when it comes to company-specific handouts. Having a culture and practice of transparency and public disclosure when it comes to all assistance to industry is not only an investment in good government, but also our greatest protector against the insidious corruption of our important public institutions.

Michael West  in the Sydney Morning Herald contends the Department of Industry, Innovation, Science, Research and Tertiary Education is paranoid about protecting business interests and that the car makers' accounts and public relations and ''communications'' thickets are hard to penetrate. However:

The fact is, the government should not be hiding this stuff, nor chewing through taxpayer dollars trying to suppress information in the courts, information which should be public. It's in the public interest for people to know what deals are being struck with their tax dollars, especially if they are propping up purportedly unprofitable businesses....
Greater transparency is clearly warranted in the light of the findings of this Business Day investigation of the Holden, Ford and Toyota accounts. Once again, in a pattern replicated year in, year out, as much profit as appears possible has been sent offshore. The car industry, it seems, has been taking the taxpayer for a ride, an epic ride....
Above all, there is undeniable public interest in having this all out in the plain light of day. No suppression of information, and far greater transparency on the part of government and the manufacturers has to be a good thing.

At the state level there is also a tendency to treat payments to industry as sacrosanct- payments by the government to the organisers of the Grand Prix in Melbourne just one of many examples. But no-one has taken it as far as Queensland where the Bligh Government legislated an absolute exemption for seven years for information about incentive payments to an organisation for investing or spending money in the state that is intended to create job opportunities or to continue existing jobs. Holden, Ford and Toyota and lots of others would just love this, particularly if other jurisdictions would come on board.

Schedule 3 Clause 11 of the Queensland Right to Infornation Act provides that access to a document may be refused to the extent the document comprises exempt information, the definition of which includes: 11 Investment incentive scheme information 

 (1) Information is exempt information for the relevant period if its disclosure could reasonably be expected to disclose information about—

(a) a particular incentive given to, or arranged for, a relevant person under a contract in relation to an investment incentive scheme; or

(b) an incentive sought by, or proposed for, a relevant person whether or not an incentive was, in fact, given to, or arranged for, the relevant person under an investment incentive scheme.

(2) In this section—

department means the department administered by the Minister having responsibility for business, industry development, and investment opportunities and attraction, as identified in the Administrative Arrangements and within which that responsibility is administered.

incentive includes any of the following—

(a) an amount that is a refund of all or part of an amount paid as a tax, fee or charge;

(b) another amount, whether as a lump sum or by instalments;

(c) a benefit that is not an amount mentioned in paragraph (a) or (b).

investment incentive scheme means a written scheme that—

(a) promotes projects by giving incentives; and

(b) includes processes for assessing an application under the scheme; and

(c) is administered by the department.

project means a project or proposed project that involves investing or spending money, or the continued investing or spending of money, and is intended to create job opportunities or to continue existing jobs.

relevant period—

(a) for an incentive given or arranged under a contract, means the period ending at the earlier of—

(i) 1 year after the contract ends; or

(ii) 8 years after the contract begins; or

(b) for an incentive that was sought or proposed but that was not given or arranged, means the period ending 8 years after the last written communication between the department and the relevant person in relation to the incentive.

relevant person means a person to the extent the person is or was any 1 or more of the following—

(a) a person who inquires of, or enters into discussions with, the department or a public service employee about an incentive for a project, whether or not the person makes an application under an investment incentive scheme for an incentive;

(b) a person who makes an application under an investment incentive scheme, whether or not the person is given an incentive;

(c) a person who is given an incentive for a project, whether or not the person continues to be subject to a provision of an agreement about the incentive that allows the department to monitor the person or project.