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SA Health boss tight-lipped over conflict questions

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The chief executive of SA Health has refused to answer more than two dozen questions from a parliamentary committee about alleged conflicts of interest involving his former employer, citing an ongoing investigation into his conduct.

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Last month, InDaily revealed that Dr Chris McGowan had been registered as the director of a subsidiary of his former long-time employer Silver Chain Group during the first two months of his tenure as SA Health boss.

Silver Chain Group had won a $13 million contract with SA Health during that period.

McGowan stressed at the time that he had no involvement in the negotiation or procurement of the Silver Chain Group contract and that he had not received any remuneration from the company after his appointment to SA Health.

But he referred himself to the Commissioner for Public Sector Employment, Erma Ranieri, who later commissioned an independent investigator to look into McGowan’s interactions with the company while in the top job at SA Health and his management of conflicts of interest.

McGowan was summoned back to parliament’s Budget and Finance committee this morning to answer questions about Silver Chain and about his previous evidence to the committee, which one MP described as “misleading”.

But the SA Health boss said it would be inappropriate to answer any questions before the independent investigation was finished.

“As I do not in any way wish to compromise the investigation, I will take questions on notice and respond as soon as I am able following the conclusion of the commissioner’s investigation,” he said.

McGowan said variations on “I refer you to my previous answer” on more than two-dozen occasions in response to questions from committee chair Clare Scriven and fellow Labor MLC Justin Hanson.

Scriven warned McGowan he could face serious potential consequences as a result of his refusal to answer the committee’s questions today, including being held in contempt of parliament, a fine or even jail time.

SA-BEST MLC Frank Pangallo said he found McGowan’s approach “disturbing” and suggested that the Parliament of South Australia should take priority over the investigation.

But McGowan said he would take questions on notice and give them as soon as he is able.

McGowan told the committee in July last year that he had signed off a taxpayer-funded contract, awarded to his former long-time employer Silver Chain Group during his time as SA Health CEO.

But he told the same committee in October this year that he has nothing to do with awarding contracts to the company.

This is an extract of the transcript from the July 23, 2018, Budget and Finance Committee meeting:

He pointed out during that hearing that he had no pecuniary interest in the company.

And this is an extract from McGowan’s October 28, 2019 address to the committee:

Last month, Health Minister Stephen Wade addressed parliament, updating McGowan’s evidence on the executive’s behalf.

He said McGowan had, in fact, “endorsed” the expenditure of public money towards Silver Chain’s South Australian arm, RDNS SA: once in November 2018 and, on another occasion, in May 2019.

And in July this year, said the Minister, McGowan gave financial approval for the “Long Stay Patient: Short Term Transition to Discharge Project”, which was later awarded to RDNS without the executive’s further involvement.

McGowan told the committee this morning that he did not believe he had misled parliament but that he could not make further comment as a result of the ongoing investigation.

Speaking after the committee meeting, Labor Health spokesperson Chris Picton said he was “staggered” by McGowan’s approach.

“As far as I’m concerned this is unprecedented,” said Picton.

“Those (answers) should have been provided today.

“Chief executives and public servants have responsibilities to the parliament.”

The chief executive also declined to answer questions about Silver Chain Group’s Integrum Aged Care+ pilot program.

McGowan promoted the program in its original Western Australian incarnation while he was CEO of Silver Chain Group, and was later involved in assessing the program’s merits as SA Health boss before Silver Chain won the $2.63 million Integrum contract for Adelaide.

While he was Silver Chain Group CEO, McGowan described Integrum in a post on the company’s website as a “one-stop-shop approach to health and aged care, integrating all of the services a client is likely to need in the last phase of their life”.

An email from Silver Chain acting CEO Lyn Jones, sent to McGowan in his role as SA Health CEO on June 26, 2018, confirms “our telephone conversation today in which you advised that the Department intends to defer the Integrum Aged Care+ pilot program in South Australia by a further six months”.

An extract from McGowan’s diary, dated 15 February 2019, says he attended an “Integrum Aged care site visit” in Western Australia in February this year:

 

Another entry in McGowan’s diary, dated four months later, says: “Reminder – Ask Integrum for Evaluation results”:

 

The following day, according to another diary entry, McGowan met with Wellbeing SA CEO Lyn Dean to discuss the Integrum project.

Less than two weeks later, Dean signed the contract awarding $2.63 million to Silver Chain Group to implement Integrum in Adelaide.

Speaking outside the committee after the hearing ended, McGowan said his answers today were not contemptuous of parliament and that he had written to the committee twice to say that he would be declining to answer questions relevant to the investigation.

“I’m certainly do not meaning to be contemptuous of parliament – I’m just getting on with my job,” he said.

He added that he was proud of the department’s achievements during his tenure as chief executive.

“I’m extraordinarily proud of what we’ve achieved in just 18 months,” he said.

“We’ve renovated the health system to get the governance right, we’re opening more beds at the Repat, we’re just about to open some beds down at Flinders, we’ve got the car park open, we’ve got the Lyell McEwen working well … I couldn’t be more proud.

“These sort of issues are just a distraction in my view – they should be canvassed, they’re being canvassed thoroughly by the Commissioner for Public Sector Employment and I believe their report will be comprehensive.”

An SA Health spokesperson said in a statement today:

“Dr McGowan was interviewed by the independent investigator last week.”

“All information, including Dr McGowan’s diaries, were provided to the Commissioner for Public Sector Employment as part of the review.

“We will wait for the outcome of the investigation.”

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