IBAC report identifies corruption risks in public sector employment and recruitment

A new research report by Victoria’s anti-corruption agency, IBAC, identifies a range of corruption risks associated with employment and recruitment practices across the Victorian public sector. These include recruitment being compromised by nepotism or poorly managed conflicts of interest, as well as inadequate pre-employment screening failing to detect falsified information in candidate’s applications.

The IBAC report Corruption and misconduct risks associated with employment practices in the Victorian public sector identifies corruption risks that can occur throughout the employment lifecycle, from recruitment through to an employee leaving the public sector.

Key risks highlighted in the report include:

  • Inadequate pre-employment screening (such as failing to require applicants to provide information about qualifications, work history, discipline and criminal histories, and conflicts of interest) can place a public sector agency at greater risk of corruption.
  • Recruitment is vulnerable to compromise by nepotism, favouritism and conflicts of interest. Selection processes can be corrupted in the earliest stages of recruitment (such as during the development of position descriptions) and by the failure of panel members to declare or manage conflicts of interest.
  • There may be corruption risks associated with the use of recruitment agencies, ranging from the circumvention of merit-based selection and probity processes, through to more complex fraudulent schemes.
  • Where complaints are made about public sector employees and action is taken, ongoing oversight and follow-up does not always occur, which creates a risk of continued wrongdoing.
  • Conflicts of interest can arise when an employee leaves the public sector and takes up a position in the private sector, directly utilising the knowledge and relationships acquired in the public sector.

The report also highlights that ‘recycling’ of employees with problematic discipline or criminal histories across the public sector is a significant corruption risk.

IBAC’s Commissioner, The Honourable Robert Redlich QC said: ‘As IBAC’s investigations have shown, the unwitting recruitment of a person with a discipline or criminal history that should preclude them from employment in the public sector can place agencies at heightened risk of fraud and corruption.’

‘However, this risk could be mitigated through improved recruitment screening and probity vetting, and better information sharing between public sector agencies,’ Commissioner Redlich said.

The public sector is a major employer in Victoria. As at 30 June 2017, more than 297,000 and 43,000 people were employed in state government and local councils respectively.

‘Corrupt conduct by public sector employees adversely impacts on the delivery of vital government services and facilities. It wastes significant time and public money, and damages reputations and community trust,’ Commissioner Redlich said.

‘While employment in the public sector is mostly well managed, IBAC’s research report suggests a range of measures could be introduced to strengthen systems and practices to help prevent misconduct and corruption.’

Victorian Public Sector Commissioner Dr Paul Grimes welcomed IBAC’s research report, and said it provided timely insights into how public sector employment practices could be further strengthened.

‘IBAC’s report makes valuable observations about the ways that current employment practices can be further strengthened to ensure corruption risks associated with employment are minimised. I recommend every public sector agency head considers it and makes sure their Human Resources functions are across its contents,’ Dr Grimes said.

‘While it is pleasing to see the report finds most employment related activity is conducted in accordance with policies and public sector standards, the findings are still highly relevant and will be helpful in raising awareness across the public sector about employment related corruption risks and how they can be stopped.

‘The report’s suggestions merit further consideration.

‘With the large volume of recruitment being undertaken by Victoria’s public sector, it’s important that public sector recruitment and employment practices are robust, thorough and consistent across all departments and agencies, and are compliant with the Victorian Code of Conduct.’

The research report Corruption and misconduct risks associated with employment practices in the Victorian public sector has been released as part of IBAC’s role to assist the Victorian public sector to strengthen its capacity to prevent corruption. As with other IBAC research, this report aims to alert the public sector to key issues and risks and to help agencies strengthen their anti-corruption policies, systems and practices. The report is based on consultations with more than 20 Victorian public sector agencies, IBAC research, investigations and other data holdings, and open source materials including research reports, academic literature and other materials.

To report public sector corruption now visit www.ibac.vic.gov.au or call 1300 735 135.

Report and summary

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