The Australian, April 11, 2018, Robert Gottliebsen.
As we celebrate our sporting heroes at the Commonwealth Games, it’s time to also recognise two Australian non sporting heroes who risked everything in the national interest — the whistleblower in the live sheep scandal and the whistleblower who exposed the inner workings of the Australian Taxation Office.
They are being treated very differently and, in tax, I am very fearful because the early signs are that the massive “snow-making machine” installed by the Australian Taxation Office to conceal its bad practices is working.
It looks like we are going to get an inquiry headed by the ATO’s mates at treasury. It’s a classic “Yes Minister” manoeuvre and a tragedy for the nation’s long-term future.
The good news is that small business ombudsman Kate Carnell is advocating that the Inspector General of Taxation be given much more resources and the powers of making binding reviews.
I have been advocating this for almost two years so I should be happy but thanks to the ATO whistleblower we now know the problem is much worse and goes deep into the ATO culture. That’s why yesterday I detailed a much more fundamental change.
It’s time to look at these two national heroes who put Australia above their own interests. The first whistleblower alerted the community and the government that live sheep being exported were being treated badly.
The Minister for Agriculture David Littleproud and his shadow number Joel Fitzgibbon both heaped praise upon that whistleblower. Both emphasised the risk the whistleblower was taking. It is not my job to compare whistleblowers in terms of national benefit but the whistleblower that revealed on national television the truth about the Australian Tax Office — Richard Boyle — made the greater sacrifice for the national interest.
But the Minister for Revenue and Financial Services Kelly O’Dwyer did not follow the example of David Littleproud and praise Boyle for taking such a courageous step. To be fair, opposition leader Bill Shorten did praise Richard Boyle and his contribution to the nation.
This tale of two whistleblowers shows that we urgently need legislation to protect whistleblowers both in the government and private sectors.
Journalists like me in The Australian and those on Four Corners and at Fairfax are able to assemble the multitude of bad things that the ATO does to its small business taxpayers.
But it is hard to get a sense as to what is happening behind the scenes and that is what Richard Boyle did for the nation.
The tax bosses in his office had revenue budgets and wanted to achieve those budgets by the process of garnisheeing people’s income. It is an awful process that should only be used in dire circumstance because it normally sends the business to the wall. But in tax land who cares.
And so the email went to staff one day last May: “the last ’hour of power’ is upon us. … That means you still have time to issue another five garnishees … Right?”
It was as though the Avon lady was calling and then, to keep the ‘sales pressure’ up, came the later ATO email:
“Team update June 13 2017: these clients are not entitled to any additional time and shouldn’t be granted any unless they have unbelievably exceptional circumstances”
In the official media release that followed the Four Corners report the ATO said that errors had been made but many of the incidents reported were up to five years old.
The garnisheeing blitz took place just before June 30 last year not five years ago. Richard Boyle is no fool. He would have known that once he blew the whistle on the ATO he would be suspended. And, given the fact that the tax commissioner is a former policeman, police would soon be knocking on his door. There is very little protection for whistleblowers in the government arena and this national hero does not face a pleasant prospect, which is why very few of his colleagues will follow.
But Boyle believed the national interest was far greater than his personal wellbeing and for that we owe him a great debt of gratitude.
Four Corners and Fairfax also highlighted my revelation last December that the ATO was trying to put out of business a series of struggling transcribers by removing their ABN numbers.
In some ways it’s tempting to remove ABN’s from the ATO and have this system managed properly. But longer term, the ATO needs to control business numbers because when proper ATO reforms are in place they will be the key to reducing the cash economy.
The simple situation is that unless there is a very big reason to withhold them, ABNs should be available to people firstly on a provisional basis, which requires the business to put in a BAS statement every quarter and perhaps describe what the business is doing, which may be nil.
But stay in touch. Those that remain silent may lose their number. But just to take away numbers from active businesses simply because a few tax people had crazy agendas is terrible.
In its media release after this week’s Four Corners episode, the ATO said it will now tackle previous mistakes.
If it is really genuine and not just “snow making,” the ATO will reinstate Boyle and go back and examine the garnishees in May-June 2017 and reimburse whatever damage has been done to those impacted.
Similarly, those transcribers who lost their Australian Business Number should be offered to be reimbursed and given an abject apology that this will never happen to anyone again.
I think it reasonable that all damages be covered with interest and the ATO should offer a penalty on itself of say 50 per cent.
Unfortunately, the tax office is still in denial and has not begun the internal processes and so the government must step in.
Meanwhile, we desperately need proper whistleblower protection for those who help the community understand what is happening when public servants do bad things.