“Ripe for exploitation by corrupt employees”: SA Health slammed in ICAC report

SA Health has a professional culture that enables corruption, in which misconduct and unmitigated conflicts of interest are common and private interests are placed ahead of public interest, according to an excoriating ICAC report into the state’s biggest government department.

Dec 03, 2019, updated Dec 04, 2019
Photo: Tony Lewis / InDaily

Photo: Tony Lewis / InDaily

Independent Commissioner Against Corruption Bruce Lander’s report, Troubling Ambiguity: Governance in SA Health, tabled in parliament this morning, says that poor conduct and practices are “common and accepted” within the department, which fails to monitor its highest-paid staff – specialist doctors.

SA Health is “an environment where personal interests are preferred at the expense of the public interest”, the report says, with a records management system in which “important documentation either does not exist or cannot be found”, a culture characterised by bullying and intimidation and where staff experience “more instances of corruption and feel more vulnerable to corruption than the rest of public administration”.

“I have closed a number of corruption investigations into conduct of SA Health employees because the system is so poorly administered that is hampered by efforts to obtain appropriate evidence,” Lander writes.

“I have formed the view that poor conduct and practices are common and accepted within SA Health.”

Health Minister Stephen Wade this morning announced a multi-agency taskforce, led by the Department of Premier and Cabinet would be established to respond to the report.

“We need expertise right across government and beyond government, including the ICAC,” Wade told reporters today.

“Frankly, we need expertise beyond ICAC.

“This is a change that will be driven fundamentally by clinicians, not by lawyers.”

But the Opposition is questioning the Government’s refusal to provide the ICAC with the resources to undertake a full evaluation of the department.

Lander’s 66-page report, tabled in parliament by Attorney-General Vickie Chapman this morning, outlines a series of problems within the department including:

  • The department has a culture in which staff are intimidated into silence and often unaware of their responsibilities to report corruption and misconduct.
  • The department is unable to properly monitor its specialist doctors for the time they spend at work and the duties they actually discharge during work hours.
  • The spending of public money within the department, responsible for almost 40 per cent of all State Government procurement, is “irregular and mismanaged”.
  • SA Health employees “fail to identify, declare and manage conflicts of interest to which they are subject”.
  • Some clinicians “with considerable private interests and secondary employments are not being properly managed against the risks that those interests and employments pose to the provision of public health services”.
  • Parts of clinical trials were not conducted by SA Health employees, but rather by staff engaged by third party institutions.

The Commissioner writes that “because of the troubling ambiguity surrounding some key features of SA Health’s operations, those employees wanting in integrity have been tempted to engage in improper conduct, and their conduct has been facilitated, tolerated, and even condoned by the poor processes and governance in those areas”.

“I am concerned that the governance and administrative arrangements in SA Health are ripe for exploitation by corrupt employees,” the report reads.

“I accept that for every employee who is failing to perform his or her duties there may well be many who are working hours for which they are not remunerated.

“I accept that for every employee with private interests, that compromise their duties to public health, there may be many whose connections and affiliations advance policy and practice, and enhance the provision of public health services.

“But the existence of corrupt and inappropriate practices is not something to be tolerated for those reasons.”

Lander writes that he has seen time-sheets “that have been approved that record that a medical specialist performed ‘normal duties’ or similar on a particular day at a (Local Health Network)”.

“However, other evidence showed that the particular specialist was in fact working at another location and being separately remunerated.”

He says ill-defined employment obligations and insufficient means of validating the performance of certain staff within SA Health makes maladministration more likely and misconduct easier to get away with.

“It is obviously easier for a public officer to neglect his or her duties when the systems in place to verify whether or not the public officer has performed those duties are inadequate,” he writes.

“It is also easier for that public officer to assert that this neglect was unintentional or inadvertent when the public officer’s precise duties have not been communicated to him or her in a clear and consistent way.”

Describing procurement practices within the department, Lander writes that in one instance, SA Health was unable to find contracts between the department and a supplier for a procurement in excess of $1 million.

In another matter he had investigated, “a significant amount of product” was purchased with taxpayer funds “at a significant cost where approximately half the stock was never used and was never likely to be used”, where there had been “no proper assessment of the … need for the product before the purchase”.

“The purchase served to partially fund an entity which had a connection to an employee involved in the purchasing decision,” the report reads.

Lander also raises a series of concerns about doctors’ rights of private practice in public hospitals, for which SA Health has “no comprehensive policy framework”.

Doctors who engage in private practice have “a financial incentive” to treat private patients “differently and more favourably than public patients, for example, by being placed on surgical lists ahead of public patients”.

Wade said the current leadership of SA Health was determined to fix the problems identified within the report.

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Wade said many of the issues had built up over years and that the executives running the Local Health Networks that administer the state’s health system were already implementing strategies to combat them.

“These are the leaders; this is the team that will drive reform in SA Health,” he said.

“Many of the issues highlighted in the ICAC report are issues that they’re already tackling.”

He said the Local Health Network boards, established by the Marshall Government following last year’s state election, represented the ideal architecture that would be required to fix the problems Lander identified.

In his report, Lander recalls the results of a survey his office undertook last year, which found that in comparison to public servants in other agencies, SA Health employees were less willing to report inappropriate conduct internally, had a lower awareness of their responsibilities to report corruption and maladministration and were more scared for the security of their employment if they decided to make a report to ICAC.

“The overall effect of an organisation that is culturally unwilling or frightened to report corruption or inappropriate conduct is that it will become an organisation that learns to tolerate such conduct as a part of its operations,” he writes.

The survey asked public servants to say which types of misconduct they had witnessed, and “on most conduct types, SA Health respondents reported more instances of corruption and inappropriate conduct than those in the wider public administration”.

“The data establishes that SA Health respondents have experienced more instances of corruption and feel more vulnerable to corruption than the rest of public administration.”

Lander describes a “significant cultural problem” of bullying within the department.

The survey found 51 per cent of SA Health respondents reported encountering bullying and harassment.

In addition, 78 per cent of SA Health respondents rated SA Health as vulnerable to bullying and harassment.

Last month, Lander told reporters that SA Health is “riddled with maladministration” and that it “very likely” harbours corruption.

The State Government refused to give Lander the $2 million he said he would need to evaluate the department – so the Commissioner said he would produce a report for State Parliament that would “bring to the to the attention of those who matter that there is a serious problem in SA Health”.

Treasurer Rob Lucas has argued that Lander has a significant budget and can do with it what he sees fit – including an evaluation of SA Health – but Lander has argued that would require him to abandon his current anti-corruption investigations.

Opposition Health spokesperson Chris Picton today described the Government’s response Lander’s report as “weak and pathetic”.

“The question that needs to be asked is why is the Government still refusing to provide the ICAC Commissioner with the resources he previously requested to conduct a full enquiry into this matter,” said Picton.

“He cannot issue recommendations because he has not conducted that full enquiry.

“It’s astonishing today that the Government, faced with this new report that’s been released is still refusing to provide the ICAC with resources.”

SA-Best MLC Connie Bonaros said it was time for a Royal Commission into SA Health.

“What more has to happen before this gutless government decides nothing less than a Royal Commission is needed to get to the bottom of the mess that is SA Health,” she said.

“SA Health is rotten to the core – that has been proven beyond doubt by Commissioner Lander’s scathing report.

“According to Commissioner Lander, not only is clinical care being severely impacted but public servants are escaping prosecution for corruption. They are the sort of serious issues that you hear about in third world countries – not a first world economy like South Australia.”


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