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Legislative Assembly for the ACT: 1999 Week 7 Hansard (30 June) . . Page.. 1878 ..
MR STANHOPE (continuing):
We had the "it was an investment" defence. Much of the debate in this place today has revolved around the notion of investment and whether the Bruce Stadium transactions fit the definition. On 4 June, the Auditor told the Estimates Committee his view of an investment was as defined in the accounting policy manual, as being for wealth accretion. His view was that the Territory would in normal practice use available cash balances surplus to the immediate requirements of government to invest. The Osborne legal advice from Professor Jack Richardson found, and this is very important:
... the loan purported to have been made to the Bruce Stadium Redevelopment unit is not in reality a loan at all and therefore cannot be an investment.
That was Mr Osborne's advice from Professor Jack Richardson, perhaps one of the greatest lawyers Australia has ever produced. Perhaps the most damning was that of the Government's own legal adviser, Mr Richard Tracey, QC, obviously prior to the retrospective issuing of the financial management guidelines. It is interesting that Mr Tracey's advice falls into two sections, that written before the financial management guideline was issued and the one page that was written after it. This is what Mr Tracey, the Government's man, said:
All that the guidelines can do, relevantly, is to identify institutions and securities in which public moneys which are surplus to the immediate requirements of government, may lawfully be invested.
That is Mr Tracey's view of an investment. This is not an investment and never was an investment, and never was intended to be an investment. Nobody ever thought of trying to make it an investment until the Government realised that it had been sprung, and well and truly sprung, and needed a post facto excuse to try to wriggle out of the fact that it had been acting unlawfully.
Another defence was the retrospective guidelines defence. The Government has relied in great part on the validity of its retrospective financial management guidelines. This defence relies on the Bruce loan transaction fitting the definition of "prescribed investment", as I have just said. If it does, the guidelines can be made retrospective. The Osborne legal advice found:
In determining whether a statutory power can be given retrospective effect there is a well established legal presumption that a statute is not intended to have such an effect unless it reveals a clear intention to do so.
In our opinion there is no such intention revealed in the Financial Management Act but rather a contrary intention.
The Sackar advice says:
In my view any such purported retrospective operation is plainly outside the power given to the Treasurer by section 67(2) of the Financial Management Act.
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