Nov 18, 2015

Outsourcing: the key weapon in the war against transparency

Outsourcing enables governments to evade scrutiny for even the most alarming examples of maladministration -- but accountability could easily and legally be restored.

Bernard Keane — Politics editor

Bernard Keane

Politics editor

What's the common theme to these incidents in the Immigration and "Border Force" portfolio in the last two years? Each reflects a consistent pattern: the worst cases of maladministration possible within government have been hidden by the obscurity that comes with outsourcing. Example One After the revelation of repeated incidents of sexual assault and child abuse at Australia's asylum seeker detention facility on Nauru, the Department of Immigration admits it has long known about over 50 cases of assault and done nothing about them, saying that they are entirely a matter for the Nauruan government and the contractors who operate the facility. Later, the department admits that its contract with Nauru facility operator Transfield is so poorly worded that, despite sexual assaults of women and children and other security breaches, Transfield has met all its contractual service obligations and no penalties have been triggered. Indeed, the chair of Transfield, Diane Smith-Gander, declares that she is "proud" of what Transfield has done on Nauru. Example Two After riots break out on Christmas Island a fortnight ago, it is revealed staff of Serco, which is contracted to operate the Christmas Island immigration detention facility, fled their positions, allowing detainees to run amok, while other staff were so poorly trained they didn’t recognise an alarm indicating that a detainee, later found dead, had escaped the facility. Serco insists “Christmas Island Immigration Detention Centre is appropriately staffed for the detainees at the facility" but is conducting its own in-house investigation. Example Three In the course of her Senate committee work, Greens Senator Sarah Hanson-Young travels to Nauru. While there, she is stalked and surveiled by personnel of Wilson Security, which is subcontracted to provide security at the Nauru detention facility. When found out, Wilson says it was only for 12 hours and involved a rogue staff member. Later, multiple sources reveal the surveillance was for the duration of the Senator's three-day stay and involved up to eight staff, with Hanson-Young photographed and notes made on whom she met with. While Wilson apologises to Hanson-Young, the question of who ordered the surveillance, its duration and why it was ordered remains unanswered. A Senate committee calls a Wilson employee at the centre of the surveillance to give evidence, but he declines to appear. Example Four Expatriate contractors working for security provider G4S are identified as having participated in the assault on asylum seeker Reza Barati that led to his death in Australia's Manus Island asylum seeker detention facility in February 2014, but only PNG nationals face court for his murder. The exact circumstances in which Barati was murdered, which staff were involved in his murder and why the government initially tried to blame Barati for his own death by insisting he had escaped remain unclear.


People under our duty of care murdered, sexually and physically abused and allowed to escape to their deaths, and a Senator engaging in her legislative duties was stalked and surveiled by those affected by her committee work. But outsourcing places a veil of secrecy over these activities that simply would not exist if the activities were carried out by public servants. The traditional rationale for outsourcing is that private companies can provide services more cheaply than public servants, and have skills that the public service lacks. Over time, this becomes self-fulfilling -- whatever sector-specific skills were once held within the public service atrophy with outsourcing, with skilled public servants often leaving to establish their own companies offering the same services they once provided for a multiple of the salaries they earnt in the public service, taking advantage of their knowledge of internal processes and connections within the public sector hierarchy. But increasingly, the single greatest advantage governments obtain from outsourcing isn't cheaper services but the massive reduction in accountability that outsourcing enables. Consider the contrast between the public sector and contractors like Serco, Transfield and Wilson:
  • Public sector documents are subject to freedom of information laws, enabling outside parties to gain an insight into government decision-making and awareness otherwise out of public view. Internal documents produced by contractors providing the same services as the public sector are beyond the scope of FOI;
  • Public servants must appear regularly before Senate estimates committees to face scrutiny over their behaviour and how they spent public money. Contractors must be specifically requested to appear before references committees and, as the case of the stalking of Hanson-Young shows, may decline to do so; and
  • Public servants are subject to an APS Code of Conduct governing their behaviour in how they perform their roles, as well as a jungle of procedural, expenditure and record-keeping restrictions that limit their capacity to evade accountability. Private contractors face no such requirements; indeed, unlike public servants, contractor staff do not even have to be Australian citizens -- companies like Serco rely heavily on imported staff via 457 visas, who can return to their home countries and beyond the reach of Australian jurisdiction if necessary.
Outsourcing thus enables the expenditure of public money, and the implementation of public policy, without any of the established restraints and scrutiny that normally limit public sector behaviour. Murder, rape and harassment of elected officials can be dismissed as an issue for contractors or other governments, despite occurring within Australian-funded facilities or being carried out by Australian-funded staff. It doesn't need to be this way. How do we know? Because the Immigration Department has shown us. As Crikey reported earlier this month, Immigration obtained legal advice that it could impose an extensive range of restrictions on contractors and sub-contractors, in effect turning them into de facto and de jure public servants for the department's purposes. While Immigration has used such powers, bizarrely, to impose drug tests on contractors, its primary goal is to ensure it can prevent anyone involved, however indirectly, in the provision of services involving asylum seekers, from revealing abuse and criminal conduct using the powers of the Australian Border Force Act. That is, when it comes to undermining accountability, outsourcing is in effect abandoned and private providers are insourced into the secrecy requirements of governments. But the same stringent requirements could easily and legally be used to insource accountability for outsourced services, and the companies that provide them, to provide the same levels of scrutiny as public servants face. If contractors want taxpayer-funded contracts, they could be subject to FOI, they could be required to appear regularly before Senate committees, they could be subject to the same record-keeping, conduct and procedural requirements as the public service. However, that would wreck the primary advantage governments get from outsourcing, the ability to wish away responsibility for even the most serious abuses and negligence.

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16 thoughts on “Outsourcing: the key weapon in the war against transparency

  1. Nick Seidenman

    The most effective way to restrict democracy is to transfer decision-making from the public arena to unaccountable institutions: kings and princes, priestly castes, military juntas, party dictatorships, or modern corporations.

    That’s the standard technique of privatization: defund, make sure things don’t work, people get angry, you hand it over to private capital.

    – Noam Chomsky

  2. Coaltopia

    Yes, great points in that second-last paragraph.

    And good quote Nick.

  3. Adrian

    Outsourcing these type of “services” creates a profit incentive that is linked to something that should never happen in the first place. It creates the incentive for companies like Wilson, Serco and Transfield to lobby the government and pay media companies to focus on more secrecy, more strict refuge policies, more deportation of New Zealanders. There should be no business in abuse. These types of services need to be some of the most transparent that the government provides as they’re the most open to abuse and the people are the least powerful in our community.

  4. Woodstock

    Its warming to have articles and journalists with the courage to highlight these matters. Our border protection is shameful and demonstrates the lack of moral integrity our political leaders have. As for the “agency” with its trail of outrageous behaviour over many years. Don’t Cornelia Rau and Vivian Salon.
    In a way, I can accept the lack of moral courage from the politicians, it the cheap, lack of rigor quality of mainstream media that disappoints me.

  5. graybul

    Thank you Bernard for persisting! Could you extend your viewpoint to an analysis of what means remain whereby the electorate can retain faith in our governmental system? It is clear that neither major party is open to reversing current practices.

    Your examples as detailed are incontestable and reflect the erosion of acceptable standards. Furthermore they illustrate the cancer alive within the Public Service and depth of concern within community as we seek safe harbour from fear, complexity and loss of trust in our political class. Oh for a plumber or metal worker!

  6. Murray Scott

    Spot on Bernard. The same principle is used to sabotage Government responsibility for Greenhouse gas emissions from electricity generators and distributors.

  7. Hunt Ian

    Yes, spot on, Bernard. The cover provided for this is the ideological clap trap about markets and how competition provides everything more efficiently than government. It is sickening that this clap trap goes on but it is because MSM provides the clap trap cheerfully and supports the laissez fair propaganda of the IPA and most of the ISA.

  8. behrendt

    Great article Bernard. The rate at which we are privatising anything and everything, one wonders why we need so many state and federal representatives. The way things are going, there won’t be too many government departments left to head up. I wish somebody would do a thesis on the pro’s and con’s of privatisation over the past 15 years. I’ll take a bet now that we, the poor suffering taxpayer, come out second best.

  9. Bohemian

    You have really nailed it Bernard. Don’t let go of this until it is fixed. Detention doesn’t have to be cruel – it can be humane even for those who are questionable applicants. It is incumbent on our new government team to “defascisize” (a dubious construction but it has a ring to it)our outsourcing policies across the board and its enforcers along with it perhaps. Talk about blowback!
    I don’t know why the public servants who work for these “detention centre” guys can’t go back to work for the government rather than having been “outsourced from the government to Serco and GS4 in the first place. These are two companies whose UK employee roster is about 90% former government employees but manage to get far worse out of them than the government ever did, judging from the fines and penalties they have been slugged with and that was because the things they did were so outrageous the UK government couldn’t cover them up. As for Transfield, I would be surprised if they ever really wanted this kind of work in the first place and unless you planned to make your living from it. Bad ju ju if you ask me B’wana. Bad ju ju.

  10. Norman Hanscombe

    There’s little point quoting Chomsky or anyone else since you show you don’t understand the point he was making.
    Adrian, if you want to remove the profit motive in an economy, perhaps Stalinist Russia is the example for you to praise.
    Woodstock, it’s clear that in common with many bleeding heart posters you never managed to understand WHY and HOE Rau got herself into the mess she did.
    Then came Uncle Tom Cobley and all of the Crikey Land fantasists, and it could be seen that, as usual, all’s unwell with the (Crikey) World.

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