“Particular issues have been raised about the apparent low levels of relevant qualifications and expertise of some appointees and whether some appointments have been made as gifts for political service.”

In light of such issues, the think tank has conducted what it calls the “largest and most comprehensive” domestic study of the “practice of cronyism” as it pertains to appointees of a Commonwealth agency.

Its new report – Cronyism in appointments to the AAT: An empirical analysis, published on Monday, 16 May 2022 – investigated all 974 appointments made to the AAT since the election of the Howard government in March 1996 up until now, to determine the quantum of political appointments to the tribunal, as well as their qualifications and experience.

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It used information on appointees that is available in the public domain.

Such an analysis is a critical undertaking, the think tank wrote in the report, because “the ‘stacking’ of the AAT with political appointees is having two adverse impacts: it is eroding the perceived and actual independence of the AAT, and it is weakening the capacity of the AAT to perform its functions”.

Rise in political appointments

For the purposes of the study, “political appointments” were defined as the appointment of people who, prior to appointment, had worked for a political party with representation at the federal level, in either a paid or voluntary capacity.

In the period covered (i.e., 1996 to now), the practice of cronyism – which the report noted refers to the practice of appointing colleagues and friends to government positions – was “systemic” in relation to AAT appointments.

The study found that Coalition governments have made 109 political appointments in their 21 years in office since 1996, compared to Labor’s 10 in its six years in power, meaning 92 per cent of political appointees to the AAT were made by Liberal prime ministers.

The volume of such appointments by Coalition governments is, of course, partly explainable by the number of years that Australia has had a Liberal prime minister since 1996. However, the report also details a “sharp rise” in political appointments since 2013.

Under the Howard government, 33 political appointments were made, making up just 6 per cent of total appointments under the former PM’s tenure. Under the Rudd-Gillard-Rudd administrations, 10 political appointments were made, amounting to 5 per cent of its total appointees.

Under the Abbott-Turnbull-Morrison administrations, however, the volume of political appointees has “skyrocketed”.

The three most recent Coalition governments have, since 2013, made 76 political appointments, the Australia Institute detailed, marking almost one-third (32 per cent) of its total appointees.

Political appointments have become particularly commonplace under Scott Morrison, the think tank wrote, noting that political appointments made up 40 per cent of total appointees since his second ministry.

Put another way, the report said, the share of political appointments has “surged” from 23 per cent in 2013-16 to 40 per cent in 2019-22.

Reflecting on the findings, Australia Institute executive director Ben Oquist said: “Across almost 1,000 appointments to the AAT since 1996, a worrying pattern emerges: appointments have become increasingly political under the current government.

“When John Howard was Prime Minister, only 6 per cent of appointments to the AAT were political, but in the most recent term of the current government, 40 per cent of appointments were political.

“These political appointments are much more likely to have no legal qualifications than non-political appointments, even though AAT decisions must consider facts, laws, and policy.”

Number of appointees with legal qualifications or experience

This latter point about the quantum of legally qualified and experienced appointees is particularly pertinent, Mr Oquist continued, given how the AAT is in charge of reviewing “life-changing decisions” made by the federal government.

Such decisions, he noted, include, but are not limited to, deportations, migration visas, NDIS payments, welfare payments, workers’ compensation, and veterans’ entitlements.

“Members of the public should be able to trust that their case will be heard by a tribunal member who is qualified and not appointed for political reasons,” he submitted.

The Australia Institute’s study found that while two in five (40 per cent) of non-political appointees have spent the majority of their careers working in law, less than one-quarter (24 per cent) of political appointees have done so.

Further, less than half (45 per cent) of political appointees since 1996 have legal qualifications, compared to three in five (59 per cent) of non-political appointees.

The think tank found that 42 per cent of political appointees made under Howard, as well as in the Abbott-Turnbull-Morrison years, have legal qualifications, while half did not (52 per cent under Howard, 49 per cent since 2013).

By comparison, 80 per cent of political appointees under Labor in its six years in power this century have legal qualifications, compared to 20 per cent who do not.

Elsewhere, when it comes to appointees who have legal experience on top of their legal qualifications, there were “significant differences by appointing administrations”, the think tank surmised.

Under Howard, 29 per cent of political appointees with legal qualifications had less than six years of legal experience, compared to none of Labor’s appointees and 13 per cent of those appointed since 2013.

Since Rudd defeated Howard, there has been a significant increase in political appointments of those with more than 16 years of legal experience on top of their legal qualifications: under Labor, such appointments accounted for 38 per cent of all appointees, and since 2013, it increased to 41 per cent. This is in contrast to Howard’s 14 per cent for those with more than 16 years of legal experience.

From 1996 to 2007, there has been a relatively consistent, albeit declining, number of political appointees with 6 to 16 years of legal experience as well as legal qualifications: 29 per cent under Howard, 25 per cent under Rudd-Gillard-Rudd, and 22 per cent under Abbott-Turnbull-Morrison.

Flow-on effects

The findings, the Australia Institute wrote in its report, “raise concerns about the capacity of some members to undertake their statutory duties to the highest possible standard”.

The report referenced two anonymous submissions to the ongoing inquiry being undertaken by the Senate legal and constitutional affairs references committee (the report for which is due to be tabled in June of this year), for which a former AAT member with over 20 years of service, and also current and former staff, detailed concerns about the capacity of some appointees.

Their concerns about said appointees included: “the ability to type, save a document in Microsoft Word or access resources on the internet”.

Moreover, they submitted that the “poor attitude” and “lack of interest” of appointees hinders the conducting of procedurally fair hearings, that there is a “lack of a merit-based culture”, and there is an “increased likelihood of poorly-drafted decisions”.

“While the appointment of some members who lack skills in the areas outlined above could be expected to be absorbed by the organisation to some degree, the appointment of so many members who fall within this category appears to have adversely affected the overall performance of the organisation,” the report noted.

“The practice of cronyism would also appear to have created an unhealthy division between different social groups within the tribunal.”

Recommendations

In light of the findings, Mr Oquist said: “A complete overhaul is needed to ensure that the AAT selection process is open and transparent, and not subject to political manipulation.

“This is now not only important for the AAT but is essential to fix integrity, accountability in government and protect democracy itself.”

To this end, the Australia Institute made 10 recommendations to help “restore the independence, impartiality, competency and hence integrity” of the tribunal.

An independent commission of inquiry into AAT appointments must be conducted, it suggested, with the power to compel evidence. There should be a “particular focus” on the years from 2014 to 2022, it added.

Special legislation should also be introduced – following the resumption of Parliament – to revoke, “where legally possible, all membership positions on the AAT”.

All new and reappointments, the think tank outlined, should be made in line with its recommendations for future membership.

These include, it listed, the categorisation of those who have worked in paid or unpaid roles for federal political parties, ineligible for appointment to the AAT for at least four years from the time of their work with that party.

In instances of AAT decisions being made by only one member, qualifications to practise as a legal practitioner should be possessed, the report continued, and minimums for legal experience for certain AAT roles should be implemented, such as that deputy presidents should have no less than 16 years of legal experience.

The Australia Institute also recommended: that all AAT appointees should be given five-year terms, that appointments should be made through an “open and transparent selection process”, that AAT members should be required to publish details of their qualifications and prior work experience, that conflict of interest provisions be bolstered, that resignation from political parties be a requirement for AAT membership, and that all aforementioned suggested changes be reflected in the AAT’s enabling legislation.