Independent Commissioner Against Corruption Bruce Lander dropped a bombshell on the state’s largest government department yesterday, telling reporters he was “very confident” there was corruption within SA Health – and that it was “riddled with maladministration”, making corruption more difficult to detect – but that he doesn’t have the resources to evaluate it.
Letters released by the ICAC this morning show that Lander wrote to Health Minister Stephen Wade in August last year asking for $2 million to fund an evaluation of his department’s processes and procedures.
According to the documents, both Wade and SA Health CEO Dr Chris McGowan agreed it would be desirable for the ICAC to conduct such an evaluation – but Treasurer Rob Lucas declined to provide the funding.
Speaking on ABC radio this morning, ahead of the release of those letters, Lucas argued that the Commissioner had the responsibility to investigate SA Health and suggested he did not need more resources to do it.
“The Independent Commissioner Against Corruption has the legal power, authority and a very significant budget that if there are allegations of corruption for him to investigate,” said Lucas.
“We increased the ICAC budget last year by $14.5 million over the forward estimates (the next four years).”
In one of the letters released this morning, dated 20 August 2018, Lander writes that one in every five complaints to his office had related to SA Health, which was “at serious risk of corruption, misconduct and maladministration”.
A number of investigations already undertaken by my office have been thwarted because of … condonation of improper behaviour or improper practices by senior staff.
“Based upon observations over nearly five years as the Independent Commissioner Against Corruption I have formed the view that there is widespread maladministration throughout SA Health,” the letter reads.
“A number of investigations already undertaken by my office have been thwarted because of poor records management and condonation of improper behaviour or improper practices by senior staff.
“Those investigations have exposed not only significant wrongdoing and misuse of public resources, but a culture and an environment where such conduct is not identified and dealt with appropriately.”
…both you (Health Minister Stephen Wade) and your Chief Executive agreed as to the desirability of such an evaluation.
The letter recalls meetings Lander had with State Cabinet, with Health Minister Stephen Wade and with SA Health CEO Dr Chris McGowan in early 2018, during which, “I described my concerns around potential corruption, misconduct and maladministration in various local health networks”.
“During our meeting on 16 August 2018 both your Chief Executive (McGowan) and you (Wade) acknowledged a range of issues within SA Health and you invited me to consider how I might be able to assist in identifying those issues and recommending ways of resolving them,” the letter reads.
“I am empowered under the ICAC Act to conduct an evaluation of the practices, policies and procedures of a local health network.
“I note during our meeting on 16 August 2018 that both you and your Chief Executive agreed as to the desirability of such an evaluation.”
Lander writes that such an inquiry would be “a significant undertaking” and that his office already operates at capacity.
“The breadth of matters to be addressed, the volume of material to be considered and the broad range of stakeholders to consult would be substantial,” he writes.
“In my view, the benefits recognised by such a wholesale review of a local health network would far outweigh the resource investment required to conduct the evaluation.
“I indicate that I will not be in a position to undertake an evaluation of such magnitude without the provision of additional resources.”
However, in a letter sent to Lander almost a month later, Treasurer Rob Lucas says it it up to the Commissioner whether he evaluates SA Health, but that the Government is not in a position to provide additional resources to fund it.
…the government is not in a position to provide any further additional funding
“The government through the 2018−19 Budget has provided ICAC with additional funding of $14.5m over four years to support its operations and to enable ICAC to hold
public hearings,” Lucas’s 18 September 2018 letter reads.
“Therefore I advise that the government is not in a position to provide any further additional funding as outlined in your letter.”
The Treasurer notes that the Government had appointed administrators, KordaMentha, to analyse the finances of the Central Adelaide Local Health Network and that its initial findings had revealed that CALHN “continues to overspend significantly and the situation may have worsened”.
“In conjunction with the Minister, I have determined that urgent corrective action needs to be taken,” Lucas’s letter says.
“This will have to occur in the near future, whether or not ICAC undertakes an evaluation.
“It is clearly entirely a matter for your decision as to whether an evaluation … should be undertaken by ICAC and the scope of such an evaluation.”
In a letter to Wade that same day, Lander writes: “I am disappointed that the Government is not in a position to provide the resources necessary in order to conduct that evaluation.”
“I think such an evaluation would be of significant benefit to the state, but given the sheer size of such an undertaking I am simply not equipped to conduct it given my present resources.
“Accordingly unless additional resources can be made available I cannot conduct an evaluation of the practices, policies and procedures of the Central Adelaide Local Health Network or any other local health network.”
Lander’s 20 August 2018 letter:
You can read the subsequent letters below.
Lucas told the ABC this morning that the Government was addressing financial mismanagement within SA Health through its appointment of KordaMentha, and that it was up to Lander to investigate corruption using his existing budget.
Despite declining to provide the funding ICAC requested, Lucas said he expected to see results from the Commission, given that allegations of corruption within the department were more than a year old.
“12 to 18 months down the track … he should and we would be hoping to see some results of those particular investigations,” he said.
“When it comes down to the serious issues of allegations of corruption and corrupt practices within an agency, the Act makes it clear that the Commissioner has a responsibility to investigate those allegations.”
Opposition Health spokesperson Chris Picton said the Government was failing to give the ICAC the resources it needs.
“The Premier is denying that the ICAC Commissioner should have the resources he needs to investigate this, when his office is getting paid some $5-8 million less than what Rob Lucas is paying out to his own corporate liquidators, KordaMentha,” Picton told the ABC.
“And he’s poised to sign another extensive contract with them but he’s not giving the ICAC Commissioner the resources he needs to investigate these serious matters.”
The corruption probe funding fracas the latest crisis to hit SA Health, amid recent revelations that:
- Ambulance ramping is worse now than at any other time in the state’s history, and the problem has been escalating month-on-month with paramedics waiting 2303 hours with patients on hospitals ramps in September.
- Despite this, the Government is cutting 60 hospital beds from the system and offering redundancy packages for medical staff across central and northern Adelaide.
- Meanwhile, the Auditor-General has raised serious concerns about the probity of the process SA Health used to appoint KordaMentha.
The September 2018 letters:
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