Senior state government minister investigated by ICAC over allegation he arranged $3m contract for ‘personal associate’

A senior state government minister was investigated by ICAC over an allegation he arranged a $3m contract that would have given a personal associate thousands more customers.

A senior state government minister was investigated by the state’s corruption watchdog over an allegation he used his position to arrange a $3m-a-year government contract for a personal associate.

But the government agency involved found the proposal “did not amount to much more than a money-making exercise for the business”, and rejected the bid.

The Independent Commission Against Corruption found despite the minister’s personal connection there was no evidence to suggest he had made any promise the proposal would be approved.

The commission, which has issued a warning ministers should “be aware of their vulnerability”, did not say whether the unnamed minister involved represented the current or former government.

Premier Peter Malinauskas. Picture: Russell Millard

A government spokesman said, after the commission’s report was tabled in parliament on Tuesday, that Premier Peter Malinauskas made inquiries of his own ministry.

“The Premier is in receipt of no information that indicates these issues relate to any minister in the current government,” the spokesman said.

An opposition spokesman said he was “unaware of any member linked to the report” and noted “it would be illegal for a minister to tell a Premier they were investigated by ICAC without written authorisation to do so through the OPI, meaning any assurance on the matter might not be accurate”.

The report, entitled Yes Minister, said the business owner at the centre of the investigation was already contracted by the government to deliver a service at the time he approached the minister.

That arrangement had been in place for several years and there was no suggestion of impropriety, it said.

In “private interactions”, the business owner pitched a scheme whereby registered users of a free government service would be forced to pay for an ongoing membership from another business owned by that individual.

“That is, the entities would not be able to access the free government service if they did not maintain a financial membership with the business,” the report said.

“In what would have resulted in an increase of more than 10,000 customers, this was plainly seen as an opportunity for the business to easily expand and significantly increase revenue.”

According to the report, the minister facilitated an opportunity for the business owner to discuss his proposal with the agency’s chief executive, who quickly found the proposal did not align with government priorities or the public interest.

Some days after the scheme was knocked back, the same associate made a second proposal to the government offering to sell a related product for $50,000.

Commissioner Ann Vanstone. Picture: Tony Lewis Photography

That proposal was also reviewed by senior executives within the agency, and the product was ultimately purchased by the government.

In a statement, Commissioner Ann Vanstone said she was “curious about what might have motivated the subsequent deal”.

“Nonetheless, we examined the proposal and found that it was subjected to a process of due diligence,” she said.

However, she found there was “the potential for preferential treatment” when unsolicited proposals made their way from the private sector to ministers through personal contacts.

“While it is reasonable that members of the public engage with ministers for the purpose of raising matters of interest or to advocate for government action, ministers need to be aware of their vulnerability in this regard,” she said.

Originally published as Senior state government minister investigated by ICAC over allegation he arranged $3m contract for ‘personal associate’