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Monthly Archives: January 2011

So I think we all know the story. The future outgoing Premier, Ms KK has deliberately prorogued Parliament early to frustrate an upper house inquiry into the privatisation of the States’ electricity assets.

Background

From a political point of view, it made complete sense. There is strong evidence suggesting the sale of the electricity generators was a bad deal for NSW. Perhaps, perhaps, it could be argued that it was better than not selling the assets since they were sold for above retention value and it brought private money into the system which would allow NSW to upgrade its aging power infrastructure. On the other hand, it is equally clear that if the sale were not made to run on a political timetable that a much better deal could have been made for the taxpayers. A higher price could have been negotiated and a better contract could have been drafted if the opposing parties hadn’t smelled blood in the water. (From memory, I believe the contract doesn’t require the private companies to invest in new generators, but I think it was somewhat more nuanced than that). Ms KKK wanted the assets sold before year end so they played hardball. So its not surprising that 8 of the 11 directors

Equally, proroguing Parliament made sense. Much better to have the bad news headlines come early, during the Christmas holidays when people are overseas or otherwise inattentive than to have an inquiry in February – just a month out from a general election. And even if the inquiry is ‘political’ and run entirely by politicians, the word inquiry always conjures up notions of impartiality. (KK, by the way, insists that it is a coincidence that she prorogued Parliament early, but noone really believes her). KK believes that proroguing Parliament will deny privilege and certain Parliamentary powers to the committee. That allows her to threaten potential witnesses with lawsuits. Since some of those witnesses would be former directors of the company, they hold certain fiduciary duties to that company and could be sued on that account. Of course, even if KK is wrong about the legality of the committee, she has created sufficient uncertainty to deter many witnesses.

Legal Arguments

So all that is your run of the mill incompetent NSW government controversy stuff and I can’t be bothered reporting on it. What I find interesting is the legal arguments over whether the Committee is able to hold an inquiry even though the Parliament has been prorogued. And, if it can, is the Premier acting in contempt of Parliament by threatening potential witnesses with legal action?

I’m going to say this up front. I do not have the legal expertise to answer this question. We do not learn State Constitutional law in law school, so beyond the basics I have no specific knowledge and am relying on the SMH. That is always a bad idea.

KK is relying on advice from the Crown Solicitor in 1994. (Apparently, he is still in the job but on holidays – KK doesn’t want to recall him because, from her POV, there is a risk he will change his mind). The contents of that advice haven’t been reported by the SMH. The argument would be something along the lines of “the definition of proroguing Parliament is that all business is halted… including Committee business. Therefore, without business, shouldn’t the Committees be deprived of Parliamentary power?” The advice may also contain historical precedents (but I haven’t seen any such precedents reported in the SMH).

The counter-argument by the Committee members and the Opposition is that times have changed. The Clerk of the upper house (a lawyer and expert in Parliamentary procedure herself) agrees. She places particular emphasis on the fact that the amended Standing Orders actually allow “the House may establish standing committees which have power to sit during the life of the Parliament”. Proroguing Parliament only shuts down a session of Parliament without ending the life of Parliament (which would cause an immediate election). That suggests that the Committee is still active and requires Parliamentary privilege and powers. On the other hand, if it has no business, why does it still need those powers? Alternatively, if it is conducting certain activities, perhaps those are not defined as Parliamentary business and hence not protected. There are many arguments to be made.

Furthermore, I wonder what the status of the Standings Orders are. Are they part of the State Constitution? NSW doesn’t have a single document called the State Constitution, but its scattered around several documents including the Supreme Court Act and a few others. If it isn’t, then obviously the contents of the Standing Orders can’t affect the interpretation of the Constitution and the powers of Parliament.

On the other hand, the powers of Parliament evolve with time (and I’m sure the Opposition can cite examples where NSW Parliament or other Parliaments around the world have changed the definition of proroguing). The Standing Orders would contribute to that argument. In fact, with respect to the Federal Senate, Odgers’ classic textbook on Parliamentary practice agrees that this is an outdated convention. ┬áIt’s all terribly fascinating.

PS: Yes, I am aware this is an atrociously written article. I was somewhat hindered by my total lack of legal knowledge in this area so every sentence has to be hedged and qualified.