NSW: state of scandal

Issue 

Less than 12 months after its re-election, the NSW Labor government is in a poll slump — Premier Morris Iemma has a public approval rating of just 34%, according to a Nielsen poll released on February 26 (the Coalition's Barry O'Farrell managed just 27%). The government has been rocked by scandals involving dodgy deals with developers, new hospitals unfit for patients, and faulty equipment delaying the opening of new rail lines.

It also faces stiff opposition to its plan to privatise the power industry, with a Nielsen poll released on February 26 revealing 64% of participants opposed power privatisation; only 25% supporting it.

The most serious scandal facing the government began with an Independent Commission Against Corruption (ICAC) inquiry into the dealings of former Wollongong Council town planner Beth Morgan, who is being investigated for her approval of four major developments in the Wollongong Council area from 2004-07. Morgan admitted to sexual relationships with the developers in question and to receiving gifts and cash.

On February 21 the scandal widened, with two state ministers fingered for their friendship with Joe Scimone, a former Wollongong Council officer also under investigation by ICAC. In December, Scimone was given a $200,000 job with NSW Maritime — part of the department of ports minister Joe Tripodi, who is a long-time friend of Scimone. Police minister David Campbell is also under a cloud, having been a friend of Scimone for years and mayor of Wollongong Council while Scimone was employed there.

While the Wollongong corruption scandal has embarrassed the Iemma government, it is questions regarding ministers' relationships with developers that have really created a crisis for the government. On February 28 the Sydney Morning Herald reported that the NSW Greens had made a complaint to ICAC against planning minister Frank Sartor, who they alleged called the managing director of the developer Stockland to solicit attendance at a fundraising dinner. Sartor also faces scrutiny of his decision to rezone a large piece of land near Queanbeyan — against the advice of an independent panel — in favour of a developer who has donated $154,000 to the ALP since 2002.

The SMH also revealed that Sartor had also "[taken] control of a major Labor Party donor's $51.7 million residential development in Burwood shortly before he appointed an independent planning panel to assess all other similar developments in the suburb". Sartor has denied any impropriety and Iemma has threatened any journalist who accuses Sartor of corruption with a defamation suit.

Iemma has promised to review rules relating to political donations from developers to political parties. Developer donations to NSW Labor totalled $13,180,793 between 1998-2007, according to the February 23 SMH.

"A wave is starting to engulf the NSW ALP, which for over a decade has been awash with developer donations", NSW Greens MP Lee Rhiannon said in a statement on February 27. "The public understands that local communities are being dudded in favour of Labor's developer mates …

"The public is no longer willing to wear a donations system where money is allowed to influence political decisions to the detriment of the common good."

The scandal comes on the back of other recent government failures. A senior government planner was stood-down on February 20, following the suspension of all non-essential services at the new Bathurst hospital as a result of safety concerns. The hospital was built at a cost of $98 million, but has serious problems with plumbing and cubicles in the intensive care unit are also too small.

The development-for-donations scandal, married with the Iemma government's refusal to listen to the vast majority of NSW residents who want their power industry to remain in public hands, raises the question — in whose interest does the NSW Labor Party govern?