Well, as Crikey predicted, Agricultural Minister Bridget McKenzie isn’t likely to face consequences from within her party for doling out $100 million worth of sports community grants to organisations in seats likely to swing Liberal. She has Scott Morrison’s support and has rejected calls to resign.
But repercussions may come from outside the government, with Slater and Gordon Lawyers announcing it is investigating a class action over the sports rort.
So just what would such a case look like?
A one-of-a-kind class action
As it turns out, the entire sports grants program may be unconstitutional. Constitutional law expert Professor Anne Twomey has warned that the federal government lacks the power to hand out money to sports clubs.
The Australian National Audit Office further found in its report into the rorts that McKenzie acted without legal authority, as only Sports Australia was permitted to approve the grant — not the minister.
Leading Slater Gordon’s class action investigation is practise group leader Andrew Baker, who told Crikey the case is potentially “unique”: his firm hopes to cover “several hundred” groups which missed out on funding.
“Any class action we pursue would be intended to cover all such groups, with the intention of putting them in the position they would have been in had the correct process been followed,” Baker said. If it goes ahead, the case is likely to be held in the Federal Court.
Baker added that without a class action, most sports groups would be reluctant to fight the government as it would affect the possibility of future grants.
“The best-case scenario is that the groups that would have been funded under Sport Australia’s assessments are given the funds that they were originally recommended to receive,” Baker said.
The stated aim of the grants program is to increase community participation in sport and physical activity.
But, as was revealed yesterday, McKenzie apparently determined that places like the Tea Tree Gully Golf Club — which plans to build a new foyer and install a lift to make the place more appealing as a wedding venue — was apparently more deserving of funding than, for example, the Coledale Waves Football Club — which is used by 1200 players each week and is in dire need of a new change room.
“Every dollar that went to a club whose application should have been unsuccessful is a dollar that didn’t end up with a club that Sport Australia had identified and recommended for funding in the course of proper processes,” Baker said in a Slater and Gordon media release.
“These community organisations, clubs and groups have lost out because it appears public funds were used for political gain.”
Maurice Blackburn principal lawyer Josh Bornstein has also offered to work pro bono for clubs that were denied funding.
Any lawsuit would be long, painful and unprecedented
Marque Lawyers managing partner Michael Bradley said he couldn’t think of any similar class actions. “It’s a new one … it’s unprecedented in terms of the concept and would involve some pretty novel legal arguments,” he said.
With the government looking at the rort from a political perspective and focusing on larger legal issues, Bradley predicted the class action was “pretty unlikely to get off the ground … the government would mitigate against the likelihood of it really going ahead”.
But, he predicted, organisations screwed over by the rort could try to claim the money they would have been granted, or what it cost them to apply. (Coledale Waves said it spent more than 100 hours preparing its application.)
“They could claim they were the victims of some sort of fraud or misrepresentation, or that it was a breach of contract and they were lied to,” Bradley said, adding that a case like this could drag on for years.
While any hopes for accountability and justice is likely to be drawn out and complicated, the Liberal government may be starting to learn that sometimes there are consequences for actions — and it only takes one novelty cheque to throw you under the bus.
Sports rort !!
pales into insignificance in comparison with the fossil fuel /Coal/CSG global rorts now endangering global populations because ‘Crikey’ et al, show nil interest in pursuing compensation from the fossil fuel corporate culprits by shining an ‘investigative journalistic’ light on their hideous operations.
Well Done!!! – Not.
If the whole thing was unconstitutional or illegal then how could a class action succeed?
Perhaps, if the position is that the program was funded by the Commonwealth for the Australian Sports Commission to administer, constitutional validity would turn upon whether establishment of the ASC itself is a valid exercise of legislative power.
Assuming for the moment that it is, one question arising from the ANAO report is whether the absence of direct legal authority in that Act for the Minister to herself approve the grants means that her purported decisions to make the grants can be set aside by a court as invalid. If she had no power, or is found to have abused whatever power she did have, she and presumably the ASC might consequentially be directed to make the the decision in question according to law, ie recommit the grant to a deliberative process consistent with the guidelines published by ASC.
I am not across current administrative law and statutory provisions but the 1965 case of R v Anderson,Ex parte IPEC is, if still authoritative, a leading High Court case on how a Minister’s decision can be set aside on judicial review in circumstances where the Minister effectively overrode a Departmental decision to substitute his own view based upon government policy. The principles associated with that case are probably still more or less operative: they were relatively straightforward; a Minister may be acting beyond power if a decision otherwise in her power to make is made for reasons that are ulterior or irrelevant to the purposes for which the power may properly be exercised; if the power did not reside in her but in someone else, her purported exercise of it instead of the other person, is invalid. Whatever the Attorney General comes up with as an excuse for McKenzie ( and her cohorts who appear to include Morrison’s office advisors) they are unlikely to provide a legally plausible counter to those well established principles.
One problem for a class action plaintiff may be that, to get the merits of it’s case considered, it may have to attack a particular grant arguably made in wrongful substitution for it’s own application for a grant. Potentially, taking the candy off the LillyPilly Football club in Morrisons seat, or off the Mosman Rowing Club in Steggall’s seat, would seem a necessary step in order to advance a claim for a similar amount of candy on behalf of say the Coledale Waves club in the safe ALP seat. That may prove a deterrent, be seen as a politically unpalatable way of seeking relief. oIf undertaken though it is highly likely to open up the tin of worms and clusters..k that the Morrison team have brought about by so brazenly disregarding proper administration of public grants.
I have no worthwhile knowledge about the niceties of class actions. A high proportion of them seem to settle. I would not attempt an answer to your question, beyond noting that the damage claimed in a class action might be confined to incidental matters, costs of making a claim not given due process etc, rather than for a grant of the value applied for. Constitutional points may not be taken or arise in such matters.
It may be enough to say that it requires no great understanding of admin law principles for it to be plain that the team who put together the grants packages covered in the ANAO report lacked basic grasp of matters that should have been elementary to any competent senior advisor to a Minister or Prime Minister. We can see here direct evidence of the price paid for the LNP policy of outsourcing the public service, demanding ” facilitators not policy advisors”and surrounding Ministers with apparatchiks, cronies and those who dare not offer a dissenting voice. Sadly the same crew are responsible for much more important matters than converting a taxpayer funded sports facilities enhancement program into a marginal seats campaign slush fund.
At the very least consider that Sports Australia (SA) must have put many taxpayer paid hours into an appraisal of the presumably hundreds if not thousands of nation wide applications. If 73 clubs rejected by SA were given donations by the minister there is gross waste of taxpayer money. Probably small relative to the handouts to mates securing detention centres or operating GBR protection foundations but same level of lacked morality. I believe any “grant money” passed by parliament for this type of multiple handout be assessed by the public service authority responsible for area as happened here. At least 90% must be delivered as assessed with minister able to play favourites (or whatever else you wish to call it) with 10% only.
A commentator on abc radio this morning questioned whether the Lilly Pilly Football Club was actually eligible as it was given to complete work on a building already started, not new work as was the one of the criteria for the grant. Eligibility is the word that McKenzie and Morrison keep using to justify the allocations. We were told that however the grant was eligible because it was in fact new work, just on the same building???