This might be the pate of a
politician….one that would circumvent God
Hamlet Act 5, Scene 1
Introduction
The recently released Independent Panel Review (IPR)
into the proposed Dan Murphy (DM) development in Darwin is, in public
policy terms, a fascinating document (link
here).
It was commissioned by the Board of Woolworths, one of Australia’s largest and
most ubiquitous corporations. The panel appointed was led by Danny Gilbert, one
of Australia’s most well connected and socially aware corporate citizens. It is
comprehensive, analytically dense, rigorously argued, and deals with a
multitude of issues. On its face, it is about the role and responsibilities of Woolworths
in particular, and business more generally, in relation to contentious public
health and social policy issues arising from corporate operations that have
negative impacts of one kind or another on the community.
So, the IPR canvasses issues such as corporate social
responsibility in a modern economy, corporate Australia’s relationship with
Indigenous Australia, governance standards within a large corporation,
particularly in relation to subsidiaries, an economic, demographic and social
snapshot of the Northern Territory, alcohol consumption in Australia and
particularly in the NT, regulation of alcohol sales in the NT, the adequacy of
community consultation processes by a large corporation. While all of these
issues are discussed in relation to a particular proposal, namely the proposed
Dan Murphy’s retail development in Darwin, much of the discussion is relevant
to, and has implications for, broader relationships between corporate Australia
and the wider community.
However, the IPR is also about the broader relations
between what I will term mainstream Australia and Australia’s Indigenous
citizens. In particular, it is about one of the most fraught issues underlying
sustained and ongoing Indigenous disadvantage, namely, excessive alcohol
consumption, and its wider ramifications.
The challenge for the nation is to find a sustainable
balance between the rights of citizens to consume alcohol and managing the
severe, but non-universal consequences of excessive consumption. For a range of
complex but in many ways obvious reasons, a proportion of Indigenous citizens
appear to be particularly vulnerable to these adverse consequences. I don’t
propose to explore the issues of responsibility for these outcomes in this
post, but would merely note that like many social processes, it seems likely
there are multiple causes underlying these adverse outcomes.
In this context, corporations clearly have social responsibilities
to minimise harm arising from their operations. The IPR can be read as one of
the most robust and rigorous arguments in support of this proposition to
emanate from within the business community. However, so too do governments have
responsibilities both to regulate potentially harmful activities within the
community in the public interest, and to minimise harm from their own policy decisions
and actions.
The IPR is framed as a report to the Board of Woolworths,
and its focus is squarely on what Woolworths should do to align its commercial
policies in Darwin and surrounding regions with its wider corporate social
responsibilities. The IPR makes nine key findings, all directed to Woolworths
and by extension to its (currently) majority owned subsidiary Endeavour which in
turn owns the Dan Murphy brand and network of retail outlets (link
here).
The concluding sentences of the Executive summary are a
succinct summary of the IPR’s overarching conclusion:
…
the Panel recognises that the negative impacts that arise from the over
consumption of alcohol in the Northern Territory, laid out in detail in this
report, are off the scale, not just by Australian, but by international
standards. The resulting impacts in terms of human suffering and social and
economic costs cut right across the Northern Territory community and are not
confined to Aboriginal and Torres Strait Islander Territorians. They cannot be
ignored. (p.13).
I recommend readers take a look at the IPR. The Executive
summary, summaries at the beginning of each chapter, and the use of well-designed
graphs and figures go a considerable way to making an otherwise complex
document accessible.
In this post, I seek to go beyond merely summarising the
IPR’s arguments and findings (important as they are) and to focus on what the
IPR reveals (perhaps unintentionally) about the role of government in fulfilling
its role in protecting the public interest in relation to the consumption of alcohol.
Given the space limitations of blog post and the detail included in the IPR
itself, I would characterise this post as merely an outline of an argument. In effect,
I am laying out an alternative way of reading the IPR, and pointing to just
some of the facts and events they identify and analyse that support such a
reading.
In December 2020, Woolworths (to its credit) established an
independent review to examine the recently approved proposal to establish a DM retail
outlet in Darwin (link
here).
This decision followed an outbreak of community concern — indeed outrage — about
the regulator’s decision to approve and the way it had been approved by the NT
regulatory authorities (link
here).
One of the back stories to the genesis of the IPR is the mounting of an
extraordinarily effective campaign against the proposal by Indigenous
organisations and their allies based in Darwin and beyond led in large measure
by an extraordinary Indigenous leader, Olga Havnen. This post does not attempt
to chart the history of those efforts, but there is no doubt that without the
campaign, the Woolworths Board would not have commissioned the IPR.
Reading between the lines, it seems likely that the
decision to commission the IPR also suggests a level of concern within the Board
of Woolworths regarding the actions and decisions of its wholly owned
subsidiary Endeavour. Complicating the back story, Woolworths had announced in July
2019 that it proposed to pursue of demerger of the recently established
Endeavour Group while retaining a minority shareholding and single Board
position within the newly listed entity. That demerger has yet to be finalised.
On 29 April 2021, following receipt of the IPR, Woolworths
announced that it would not be building a DM retail outlet in the location
previously proposed (link
here
and link
here).
On 9 June 2021, along with the release of the IPR, Woolworths and Endeavour
issued separate responses to the IPR (link here and here), and
Woolworths issued a detailed document reflecting on the IPR and responding
albeit briefly to what it considered the key findings (link
here).
While I don’t propose to analyse those responses in detail in this post, it is
clear that the Endeavour response is more limited and much more defensive than
the Woolworth’s response. This is perhaps explained by the forthcoming
demerger, which will leave Woolworths with a minority shareholding in Endeavour
of 14 percent, and Endeavour with the task of undertaking the heavy lifting in
terms of balancing its commercial alcohol retail operations in Darwin and the
wider public interest in harm minimisation.
The NT
Government’s role and responsibility
Chapter 5 of the IPR describes the level and consequences
of alcohol consumption in the NT. The summary of the chapter states, inter
alia,
The
Northern Territory has the highest rate of alcohol consumption in Australia,
and a much higher share of the population drinks at risky levels compared to
the Australian average…The financial costs to Darwin and the Northern Territory
Government from these harms are also acute. Given the demonstrable health and
economic costs, it is clear that the level of alcohol-related harm requires
urgent and meaningful attention. (p.49)
Contextualising the horrendous statistics on disadvantage
amongst Indigenous citizens, the IPR states:
There
is a view of some in the community that Aboriginal and Torres Strait Islander
disadvantage is intractable and that First Nations peoples must bear full
responsibility for their status without any compromise to the requirements and
wishes of the non-Indigenous population. The Panel rejects that perspective
(pp.52-3).
The chapter goes on top lay out with surgical precision the
devastating statistics on alcohol abuse across the NT:
The
Northern Territory has nearly six times the level of alcohol-related emergency
department presentations compared to the next closest state or territory (p.53)….
…Dr.
Mahiban Thomas, reported that an estimated 350 cases of broken jaws and noses
were admitted to the hospital each year, with 88 per cent of those cases caused
by alcohol-related assaults. Darwin was suggested to have the highest rate of
broken jaws in the world, second only to Greenland (p.54)…
…The
Northern Territory has nearly three times the level of alcohol-induced deaths
compared to the next highest State or Territory, at a rate of 8.9 per 100,000
population in Darwin, and 28.5 deaths per 100,000 in the rest of the Territory.
This figure was more than five times the Australian population-weighted average...
On the costs of alcohol consumption, the report quotes
research suggesting the financial cost of alcohol consumption to the NT
community is $1.4 billion, some 5 percent of the $24.3 billion NT Gross State
Product, or 17 percent of the $7.3 billion spent by the government on services
to the public.
Clearly, the both the economic and social costs of alcohol
are such as to warrant proactive harm minimisation policies by the NT
Government. What clearly sits behind the IPR’s conclusions are the enormous personal
costs and harm of alcohol abuse imposed on individuals, families and children. The
IPR mentions these at pp.55 and 126, but it is nevertheless likely that most
readers will pass over these points without a second glance. Yet the reality is
that alcohol is inexorably destroying the lives of drinkers, families, and children,
one day at a time. Most insidiously, alcohol has all the characteristics of an
addictive drug, and its misuse has lifelong adverse health and
psychological implications both for
users and their close families.
Chapters Seven and Eight of the IPR deal the progression of
the Woolworths / Endeavour proposal through the extant regulatory processes,
and are the key chapters for understanding the actions of the Northern
Territory Government in this saga.
In April 2017, the NT Labor Government established a review
by a former Chief Justice of the NT Supreme Court, Trevor Riley, to review all
aspects of the Liquor Act 1978 and surrounding policies. The Riley
review was published in October 2019, and made 220 recommendations proposing a
whole of government integrated alcohol harm reduction framework. The NTG
accepted 187 recommendations and pledged in principle support for a further 32
recommendations. The single recommendation rejected was to ban takeaway sales
on Sundays (p.59). As a result of the Riley review the Liquor Act was amended
in a series of amendment Acts through 2017 to early 2019, which are clearly summarised
on pp. 71-2 of the IRP.
Separately, Woolworths, through its subsidiary Endeavour, in
mid-2018 sought regulatory approval to establish its Dan Murphy development.
See the overview of the legal processes on p.73, and the detailed consideration
over the following pages. In September 2019, the Liquor Commission refused
Woolworth’s application, based on its detailed assessment of the community
impact which would flow from the proposal and its consideration of the public
interest. The IPR summarises the Commissions reasons at pp. 76-78. In an
extraordinary response, the NT Government released a public statement calling
the decision of its own independent regulator ‘a kick in the guts for responsible drinkers
who want more choice in the Darwin market’, and pointed out that it was open to
Woolworths to appeal the decision (p.81).
The Liquor Commission decision was followed by an
application by Woolworths to the NT Civil and Administrative Appeals Tribunal (NTCAT).
The appeal was dismissed. Woolworths then appealed to the Supreme Court of the
NT in January 2020. In March, a legislative amendment resolved the issue in
dispute in such a way as to allow the Liquor Commission to now approve the
proposal, thus negating the action in the Supreme Court. A further application appealing
the Liquor Commission’s decision not to approve the proposal was filed with
NTCAT by Woolworths in April 2020. This was subsequently deferred and then
abandoned after further legislative amendments which enabled a new ‘expedited’ decision
making process to be undertaken by the Director of Liquor Licencing (‘the
Director’). See pp.79-81 for a detailed description of these processes.
In Chapter Eight, the IPR assesses the impact of the 2020
legislative changes that, inter alia, removed the decision making
responsibility from the Liquor Commission, and provided for the Director to
make an expedited decision of four historical applications, including the DM
proposal. Extraordinarily, the legislation allowed the Director to make a decision
without prior notice to the applicant or any other person, without holding a
hearing, and provided that any decision would not be reviewable by the NTCAT.
The IPR concluded that these amendments were not good public policy. See the
detailed analysis and discussion on pp 83-86.
The IPR went on to report that there had been ‘significant
engagement between Endeavour and the Northern Territory Government’ in relation
to the 2020 legislative amendments to the Liquor Act 2019 (p.86). Endeavour’s
proposals were closely aligned with the eventual amendments, but with the
significant difference that Endeavour proposed that the matter be advanced by a
Ministerial decision rather than the approach ultimately adopted of the
Director making the decision. The IPR were critical of Endeavour for its
approach, in particular, its suggestion that ‘explicitly excluded any
requirements to satisfy the public interest and community impact test’ in the
post Riley legislative framework (p.87).
Without seeking to exonerate Endeavour, it is clear that
the NT Government bears a much greater responsibility for what transpired. It
is governments that are expected to act in the public interest, yet all that
the NT Government could muster was a craven attempt to facilitate the interests
of a major corporation. Moreover, they deliberately established a system where
a public servant (the Director) made the decision rather than a Minister as
suggested by Endeavour, and rather than the independent Liquor Commission as
required by the pre-existing legislative framework. It goes without saying that
a public servant is not independent of the executive arm of government. Further,
the legislation established a framework that explicitly denied the community
natural justice, while making a cynical assumption that the technical
complexity involved and (apparent) non-involvement of a minister would diminish
any public criticism.
Finally the IPR undertook a critical assessment of the
Director’s decision to approve the Woolworth’s DM proposal. The assessment
identified various legal shortcomings, problematic reasoning, and an approach
which adopted a starting point favourable to Woolworths, which set aside expert
opinion in favour of the Director’s own previous experience and informal advice
from the police, and which set aside the views of local communities most
impacted by the proposal (pp. 88-91).
Conclusion
So to summarise, the NT Government responded to the
decision of the independent Liquor Commission that had identified extensive
harm and community impact as likely to flow from the establishment of a DM
retail outlet by turning 180 degrees from its explicit 2019 commitments to implement the
Riley review recommendations, by criticising its own independent statutory
body, by overturning its own legislation to implement the Riley recommendations,
and legislating a new process that required a public servant to make a new
expedited decision within a legal framework that set aside natural justice,
precluded public hearings, prevented appeals, and allowed problematic reasoning
to trump expert opinion and community views. In short, the NT Government pro-actively
facilitated the pursuit of private interest to the exclusion of substantial
evidence that it was not in the public interest.
One of the more insidious impacts of this type of behaviour
by governments is the way in which trusted institutions within the public
domain are politicised and pressured, with deeper and widespread implications
for levels of trust in our democracy and core institutions. To take just one
example highlighted by the events described by the IPR, the NT police appear to
have been influenced (either explicitly or implicitly) to self-censor their
perspectives on the social impacts of increased availability of cheaper alcohol
in relation to the DM proposal. According to the IPR, in July 2020, the NT
police gave evidence in another application for a substituted liquor licence.
The IPR reported (p.57):
In Superintendent Antony
Deutrom’s evidence to a Liquorland application for a substitution of premises
in Palmerston in July 2020, Northern Territory Police stated that the impacts
of alcohol on the Northern Territory continue to be “appalling and
pervasive…culminating in extra strain”. At the time, demand for police services
across the Northern Territory was on the rise, up 39.5 per cent compared to the
previous period. Further, 15.4 per cent of those incidents were
alcohol-related. Superintendent Deutrom also said, “an increase in alcohol
availability could further impact on these figures in a negative manner” [footnotes
deleted].
See also Superintendent Deutrom’s comments on p.55. In contrast, the NT Police comments to the
Liquor Commission hearing into the DM proposal were much less robust:
In relation to the Darwin Dan
Murphy’s development, Commander of Police in the Northern Territory, Travis
Wurst, gave evidence to the Liquor Commission in 2019. Commander Wurst referred
to the risks attached to the proposed Bagot Road site from a public and road
safety viewpoint, the problems of public drinking, and more generally about the
role of the Police Auxiliary Liquor Inspectors and the impact of alcohol
restricted areas in the Greater Darwin area and surrounding remote communities. Commander Wurst also noted
that the Northern Territory Police were neutral on the application by
Woolworths Group and that the application was neither objected to formally, nor
endorsed in any way (p.57) [emphasis added].
Of course, the unanswered question raised by this clear NT Government
strategy to support the DM proposal is ‘why?”’ Why did the NT Government
reverse course? Why did it ignore the very significant health, social and
economic costs likely to flow from the DM proposal? Why did the Indigenous
members of the Government remain silent and accede to this policy? Endeavour
has stated that it was in discussion with the NT Government regarding the changed
location of the proposed DM outlet (link
here).
We know that Endeavour proposed legislative change that was substantively taken
up by the NT Government. What other conversations were undertaken between
Endeavour and the NT Government? The short answer is that we don’t know and the
IPR doesn’t tell us.
In an appendix, the IPR provides an extensive list of the
stakeholders consulted. It is clear that it sought to engage widely within and
beyond the NT. It lists engagement with a small number of NT agencies, but
there is no mention of any Ministers in the NT Government being consulted. It seems
highly unlikely that the Independent Panel did not seek to engage with
ministers (it mentions that it consulted with the MLA for the seat surrounding
the proposed development, Labor backbencher Mark Monaghan, as well as representatives
of the Opposition). The IPR mentions that a number of stakeholders consulted
did not wish to be named in the report. Either way, the unpreparedness of
Ministers in the NT Government to engage on the record with such a high profile
assessment of the proposal speaks volumes for the disdain the Government has
shown both to the norms of public debate about issues of significant importance
for the NT, and to the NT community itself.
While the extraordinary campaign led by Indigenous
interests and leaders such as Olga Havnen have won this battle, it is far from
clear that they will win the war.
The importance of this case study of an important public
policy process is that it has largely been driven by business. The Woolworth’s
Board clearly decided that they may not be getting the full story from
Endeavour (see p.111), and thus commissioned the IPR. The IPR clearly found
that Endeavour had been engaging closely with the NT Government.
The facts demonstrate that ‘when push comes to shove’, the
NT Government is unwilling and/or incapable of pursuing and protecting the
public interest. Perhaps the solution is for the corporate sector as a whole to
take a wider view of the issues relating to alcohol consumption across the NT,
and to develop an active strategy that seeks to protect the public interest as
well the private corporate interests they are entitled to advocate for and
pursue. After all, if — as the evidence suggests is the case — governments are
in the pocket of business, then perhaps it is time for the business sector to
step up and pursue the public interest as well as their private interests. It
is actually in business’s interest that the nation is inclusive, has a vibrant
economy, and a healthy citizenry. The IPR is potentially the first step towards
a much more inclusive and visionary stance by corporate Australia.
My recommendation to Woolworths would be that its
credibility with Indigenous Australia, and the community more generally, would
be enhanced were it to actively and transparently use its market heft and
influence, as well as its directorship on the Endeavour Board, to ensure that
both Endeavour and the NT Government put the public interest above commercial
interests in the development of future alcohol policy in the NT.
My recommendation to the NT Government is that they should
take the opportunity of the publication of this report to undertake a fundamental
reconsideration of their policy approach to alcohol regulation. To do otherwise
will be to deepen their complicity in an entirely preventable scourge that is
taking a terrible toll on many Territorians, including a substantial proportion
of Indigneous Territorians. If they cant fix this, their credibility on every
other area of public policy will remain in tatters.
Finally, I am conscious that I have not mentioned a role
for the Australian Government in these issues. Yet it was only fourteen years
ago that the Australian Government legislated alcohol prohibition across remote
NT communities citing statistics that have barely changed from those we see
today. While I am not advocating a return to those punitive policies, there is
a role for the Australian Government through the range of policy levers at its
disposal to encourage public policy and corporate policy outcomes in the wider
public interest. Silence and sitting on the fence is not an adequate response
to the ongoing health crisis linked to alcohol abuse across the NT and beyond.
