ICAC surveys show improved corruption risk management in NSW public sector

Tuesday 19 May 2009

The Independent Commission Against Corruption (ICAC)'s latest research into the NSW public sector shows that corruption risk management appears to have improved as a whole from 2001 to 2007, although it appears that organisations could still work on increasing staff awareness of some aspects.

The Commission's Profiling the NSW Public Sector II Reports 1 and 2, released today at an ICAC outreach program on the South Coast, show that more organisations appear to be using corruption prevention strategies.

The data were gathered from surveys distributed in 2007 to more than 500 NSW state and local government chief executive officers, with a separate survey sent to almost 1,000 NSW public sector staff. The surveys asked about corruption risks and risk management strategies and were designed to update and expand upon research that the Commission had conducted in 2001.

The ICAC's Deputy Commissioner, Theresa Hamilton, said that the Commission considers the formal management of corruption risks to be an important corruption prevention mechanism. "The percentage of organisations that managed corruption risks using a risk management process increased significantly from 47% in 2001 to 79% in 2007," Ms Hamilton said.

"However, the ICAC also recommends that managers provide corruption prevention-related information to their staff to help them contribute to the management of these risks, and there does not appear to have been any changes regarding the proportion of organisations that provide this information.

"While it's clear that according to the research, more organisations appear to have adopted strategies to control corruption risks, they should also examine their own usage of corruption prevention techniques to identify any areas where further strategies are warranted," Ms Hamilton said.

The percentage of organisations that indicated they had an internal investigation capacity rose from 55% in 2001 to 69% in 2007. Report 2 notes that this is an important result because it suggests that more organisations have mechanisms to progress reports alleging corrupt conduct or other misconduct.

The surveys found that while the proportion of organisations with a gift register more than doubled by the 2007 survey, 42% of staff did not know if their organisation had a gift register. The report (1) notes that a potential explanation for this is that many staff may not consider these issues until a gift is offered to them.

"Consequently, such information should be easily accessible, as staff may need to access it at short notice," the report says.

The corruption risks most commonly identified by organisations include procurement, recordkeeping and conflicts of interest. In terms of specific corruption risks, the reports say that more organisations appeared concerned about risks associated with recordkeeping, which jumped from sixth to first place as the top business activity most commonly rated as a major corruption risk requiring attention, and political interference than in 2001. Fewer appeared concerned about risks associated with cash handling, and the use of organisational resources and time, in 2007 than in 2001.

In terms of reporting corruption, only 36% of staff had heard of the Protected Disclosures Act 1994 although 90% of organisations indicated that they had heard of the Act. Many staff also indicated insufficient knowledge of internal reporting systems. These results may indicate that some organisations need to improve their communication of internal reporting and protected disclosures to staff.

The full reports, detailed information about the methodology used in the research and copies of the survey questions can be access via the following links.

Profiling the NSW public sector II - Report 1:Results for the NSW public sector as a whole

Profiling the NSW public sector II - Report 2:Comparison of 2001 and 2007 organisation responses

Profiling the NSW public sector II - Methodology and respondent demographics