I move: "That the Bill be now read a Second Time."
The purpose of this Bill is to challenge and help transform the traditional culture of secrecy that surrounds the conduct of business and public affairs in this country. Is it credible that nobody knew or suspected that all was not well at the Blood Transfusion Service Board? Did nobody in the Department of Agriculture and Food know or suspect illegality and malpractice in the beef industry? Did nobody know or suspect the consequences of Army personnel being exposed to hearing damage? Following 30 years of serious allegations, analysis and criticism of the planning system, especially in the Dublin area, is it believable that nobody in the system ever stumbled across any wrongdoing as regard illegality and malpractice as alleged against certain financial institutions? Did nobody in these institutions know what was going on? To all of these questions most right thinking people believe that people did know or at least had their suspicions but the consequences for career, family and livelihood of whistleblowing are so severe that people are prepared to turn a blind eye.
It is not difficult looking over the history of whistleblowing to understand this reaction, but on the other hand the consequences of turning a blind eye can be devastating in terms of the cost, human and financial. Therefore, what I am proposing is a set of new statutory rights for employees, whether in the public or private sector, to report and transmit information they receive of illegality or malpractice which they have discovered in the course of their employment. This is an essential step to restoring confidence in our major institutions, whether industrial, financial or governmental.
Under the provisions of this Bill any employee who blows the whistle on fraud or malpractice will be entitled to protection against dismissal or any other sanction which his or her employer attempts to impose. These rights are essential if we are serious about ending the nod and wink culture that permeates certain sectors of Irish business and public life. The Bill, if enacted, will radically challenge the culture of secrecy that surrounds much of Irish business and public life. It provides legal protection to employees who have good reason to report dubious practices to regulatory authorities such as the Garda, the Central Bank and the Revenue Commissioners. Employees who make such disclosures in good faith will be protected by the law from civil liability and discrimination in their employment up to and including dismissal.
Events of recent years have demonstrated that the legal position at present discourages individuals from reporting what they believe to be serious offences or major failings on the part of their employers. These are usually failings that have a definite public interest dimension. I could give many examples, both at home and abroad, dating back to the arms crisis when surreptitious communications at that time had to be held with the then Leader of the Opposition, Liam Cosgrave, by certain civil servants. The result was the sacking of Cabinet Ministers and criminal prosecutions.
More recently workers in the beef industry who were aware of gross malpractice at some factories had to hold clandestine meetings in the middle of the night with politicians in an attempt to draw attention to the widespread abuse of European taxpayers' money. To this day these workers live in fear that their careers will suffer if their role in exposing the abuses within the beef industry is revealed.
I am aware also that present and former employees of National Irish Bank who had originally approached the Revenue Commissioners with information on what they considered to be corporate malpractice believed that insufficient action would be taken about it by that body and therefore they believed they had to release that information to RTE. Without the assistance of Mr. James Gogarty the Flood tribunal would have been unlikely to have brought certain information into the public domain. The motives of an individual may vary. There may be a backdrop involving ongoing rows and bitterness. That is inevitable. The important consideration, however, is that no trace of legal sanction should be raised against someone who eventually decides to perform his or her civic duty and to reveal some form of illegal activity or malpractice.
The Whistleblowers Protection Bill is designed to give legal protection against persecution and discrimination to workers who find themselves in such situations. Many abuses occur in Irish life. Many abuses have occurred in Irish life due to the fact that no one shouted stop. This is just as true also in the business world as it has been proven more radically and tragically to be true in the area of institutional care. This Bill will challenge that culture. I acknowledge the role played by Deputy Shatter and the Government in accepting the Shatter Bill in ensuring that whistleblowers operating in the area of child care and in the monitoring of or interacting with those involved in that profession would be protected in their jobs so long as they acted reasonably and in good faith.
Primarily, the Bill supports individuals who make disclosures to relevant authorities which have a regulatory, supervisory or investigative role. It is not designed to encourage anyone as a first resort to run straight to the media with information received in confidence in the performance of their duties. However, recent revelations regarding abuses in, for example, the banking sector and the planning system point to the fact that our regulatory authorities must have access to information to investigate serious issues of public concern. There is an obligation on the State to ensure that individuals who provide such information are not victimised or discriminated against in the wake of their disclosures. This is not a Bill which the Tánaiste – or the Minister of State, Deputy Kitt – should address, wearing her hat for either enterprise or trade because it is an employment and public interest Bill. It is designed to secure rights for any worker, whether on a FÁS course, working in a hospital, a blood bank, a supermarket, a beef factory, a financial institution or a Department, complicit with improper decisions taken by his or her management superiors.
There is a genuine public concern at the failure of the regulatory institutions, such as the Revenue Commissioners and the Central Bank, to crack down on glaring abuses of the system. I share this concern. The Labour Party is determined that the safeguards the State has put in place to ensure decent standards prevail in public and commercial life must work and be seen to work. I do not particularly want to single out the Revenue Commissioners and the Central Bank as I am conscious that allegations made against certain financial institutions are the subject of inquiry by a committee of the House, the Committee of Public Accounts. Whereas that committee may be investigating the quantum, for example, of moneys due to the State evaded in taxation and whether there was an agreement or an understanding of any kind between the Revenue Commissioners and the financial institutions concerned, I do not think it is seriously contested by anybody that there was significant tax evasion or significant underpayments to the State during the years which are the subject of the ongoing inquiry and an imminent report due from the Comptroller and Auditor General. Nonetheless, it appears to be accepted that under-returns to the Exchequer were extensive in those years.
The Bill will greatly assist in this process. It supports the individual against the might of major companies and institutions, public and private. It upholds the right of the individual to draw attention to abuses which affect all of us and it is worthy of the support of all Members of the House. In particular, the Tánaiste is under an obligation to accept the principle behind the Bill and I welcome the news today that the Government is likely to do so.
Since taking office, the Tánaiste has instituted 13 different inquires regarding low standards in high places in certain businesses. While the Tánaiste has not yet delivered on her often promised determination to make public the findings of these inquiries, she has alluded to her shock at the level of abuse of company law which her inquiries have unearthed. She has already endorsed former Deputy McDowell's company law report containing the proposal for a new company law enforcement office. The effectiveness of this proposed regulatory body will be fundamen tally defective unless the provisions of the Labour Party's Bill are implemented in tandem with the new legal regime the Tánaiste is proposing for Irish business.
Provisions along the lines of those contained in the Bill which I am introducing on behalf of the Labour Party were originally to have been included in the Freedom of Information Act, which was steered through the Dáil by my former colleague, Eithne Fitzgerald, when she was Minister of State in the Office of the Tánaiste. I am open to correction but I understand the complication which arose at that time was that the freedom of information legislation was intended to deal solely with the public sector, including Departments, local authorities, health boards etc. However, this aspect is much more wide-ranging because it could impact on any employer-employee relationship in the public or private sector and it would not have sat comfortably in the same Bill.
Apart from anything else, two different Departments would have been involved in overseeing the implementation of the two different aspects of the one Act, the Department of Finance with regard to freedom of information in the public service and the Department of Enterprise, Trade and Employment with regard to employee protection in whistleblower cases. Nonetheless, I take this opportunity to acknowledge the ground-breaking work done by former Deputy Eithne Fitzgerald on the issue of whistleblower protection and to place the Bill in the context of the commitment to openness, transparency and accountability which produced the Freedom of Information Act, the Ethics in Public Office Act and the reforms of the Electoral Acts which govern disclosure of donations and expenses at elections and cap expenditure at all elections except, as a result of the most recent legislation introduced by the Minister, Deputy Dempsey, the recent local elections.
In considering the Bill, the first question members of the public may ask is what is a whistleblower? The best description I have read is on a website run by a US organisation called the Government Accountability Project. This project describes its mission as to protect the public interest and promote government and corporate accountability by advancing occupational free speech, defending whistleblowers and empowering citizen activists. Increasingly, it also advises public agencies and legislative bodies in the United States. Its legal director, Mr. Tom Devine, writes as follows:
Like a referee blowing the whistle in the presence of a foul, the whistleblower in the corporate or federal arena believes he or she has credible evidence of wrongdoing that bears exposure. Such wrongdoing may be illegality or fraud, gross mismanagement or waste, or a specific danger to the health or safety of the public or the environment. Whistleblowers are almost always endorsed by politicians as cham pions of justice, but their message is not always welcomed by those challenged by the disclosure.
The decision to blow the whistle in the public sector is an intensely personal one, and brings into focus the conflict between loyalty to the employer and far-reaching consequences that could result from remaining silent. Despite our society's embrace of freedom of speech, those who have the courage to voice dissent often end up as martyrs. When this happens there are no winners: the dissenter may lose his or her career by taking on the system, and, by silencing the messenger, the organisation often covers up what could be the first warning signal of a subsequent disaster. The result may also discourage others from speaking up about the problem.
Mr. Devine goes on to analyse the possible motives of a whistleblower which, as I mentioned, may not always be perfect. He writes:
Whistleblowers cannot be stereotyped as either role models or vengeful, disgruntled employees. Motivation can range from the most altruistic to the most self-serving. Some whistleblowers are conservative, others are liberal; some are braggarts, others self-effacing; some are gregarious, others are painfully shy.
Their jobs range from maintenance positions to seats in high management. What they have in common is that they have learned something that they are unwilling to keep to themselves, and they have chosen to act on that knowledge.
Deciding whether or not to expose a suspected fraud or wrongdoing at work is difficult, and brings to light a slate of seemingly contradictory values. We don't like cynical troublemakers and naysayers, but we also have contempt for busybodies, squealers and tattletales. We condemn just as strongly those who "don't want to get involved", claim to "see nothing" or look the other way when something wrong happens. And, while we believe in the individual's right to privacy, we simultaneously fight for the public's right to know.
The conflict brings up personal issues of loyalty and livelihood. Loyalty to one's family is an instinct as much as a duty; as such, we believe that we shouldn't bite the hand that feeds our family by turning on our employers. However, few would disagree that we all have a duty of loyalty to the public trust, the law and our communities. That's the heart of our duty as good, patriotic citizens.
The responsibility of public disclosure is a thorny ethical question. If an employee has evidence of an employer's illegal or dangerous activities and does not take action, is he or she acting in complicity? To what extent does the silent employee bear some of the guilt? The responsibility of taking on the system is a grave one – the outcome is not guaranteed to rectify the situation, and the whistleblower may suffer serious personal consequences.
These are very real issues which arise for any prospective whistleblower. Legitimate issues arise for the State and for business. We do not want to write a charter for cranks and malcontents, still less for those who have the least interest of their employers at heart and may even be out to sabotage those interests. A balance, therefore, must be struck and I have attempted to strike such a a balance in the Bill. However, this is not the first Legislature to address this issue. Even before parliaments turned their attention to this question, the courts in various jurisdictions had to consider the matter.
A number of people have made submissions to me since the Bill was first published and I acknowledge those contributions. As the Government has agreed not to oppose the Second Reading of the Bill, I will come back to those submissions on Committee Stage. I am grateful in particular to Ms Estelle Feldman, a research associate at the School of Law, Trinity College, for allowing me to assimilate from some of her published and as yet unpublished material on this area. I do not attribute to her any responsibility for defects in the Bill – in fact, she has pointed out some already.
The leading whistle blowing case in these islands, Gartsidev. Outram, dates back to 1856. The employers, who were wool brokers in Liverpool, carried on their business in a fraudulent manner. One of their employees, a sales clerk, blew the whistle, notwithstanding that under the law at the time, any breach whatsoever on the part of a servant of the contract of employment with his master was a criminal offence liable to three months' imprisonment. The court gave the following judgment:
The true doctrine is that there is no confidence as to the disclosure of inequity. You cannot make me the confidant of a crime or a fraud and be entitled to close my lips upon any secret which you have the audacity to disclose to me relating to any fraudulent intentions on your part. Such a confidence cannot exist.
This line of thinking was followed by our Supreme Court as recently as last year, in the litigation involving National Irish Bank and RTE. In that case the court held that, while there was a duty and right of confidentiality in the relationship of banker and customer, this was outweighed by the public interest in defeating wrongdoing through the publication of information relating to allegations of serious tax evasion. No doubt all Members of this House welcomed that especially important judgment, which recognises the bond of confidentiality which constitutes the relationship between customer and banker while acknowledging the overriding significance of the public interest in defeating wrongdoing.
However, the NIB case, although it is certainly of benefit to RTE and other media, did not deal with the central issue from the whistleblower's point of view, namely, what would happen if he was caught out? What employment law remedies would be available in the case of victimisation or penalisation? Why did he feel it necessary to approach a TV station in the first place? What would have happened if he had approached the regulatory authorities of the State with his information?
As long ago as 1978 the US Congress considered this issue and passed the Civil Service Reform Act of that year, to provide relief against reprisal for blowing the whistle on mismanagement, waste, fraud and abuse in the Federal Government. That Act was updated and reformed by the Whistleblower Protection Act, 1989.
In the United Kingdom, a country with a Government and establishment almost as notoriously secretive as our own, a Public Interest Disclosure Act, 1998 – originally a Private Members' Bill – was adopted by the Government and enacted last year. An interesting aspect of the adoption of that Bill by the British Government was that its passage was supported also by the Institute of Directors and the Confederation of British Industry.
This is a serious issue, as yet not dealt with here, which deserves legislative attention and which should not be tackled lightly. I do not claim to have written the final word in this area; if the Bill enters Committee Stage, I will move amendments to it. On Second Stage, I ask the House to accept the general thrust and purpose of this Bill and to agree that its provisions deserve further consideration. If so, we can, on Committee Stage, thrash out the consequential issues which are bound to arise. I am not married to any form of wording.
As is traditional I will now outline the main provisions of the Bill. Its purpose is to provide protection from civil liability to employees who make disclosures in categories listed in the Bill, so long as those disclosures are made "reasonably and in good faith". I stress those words and reiterate that I am not advocating a free for all for rogues or malcontents in our business and commercial world, still less in the public services – there are no rogues or malcontents in the public service. Many Members will agree with the views of the English Law Lord, Lord Wilberforce, expressed in a case involving British Steel and Granada Television. He pointed out that "there is a wide difference between what is interesting to the public and what is in the public interest to be made known".
The Bill also would prohibit the penalisation of employees by their employers where disclosures are made. It lists the persons to whom disclosures should be made and it specifies the categories of matters where disclosure is permissible. To deal with the first matter, the authorities to which disclosure can be made are listed in section 1 as the Central Bank, the Comptroller and Auditor General, the Data Protection Commissioner, the Environmental Protection Agency, the Garda Siochána, the Health and Safety Authority, the Information Commissioner, the Ombudsman, the Public Offices Commission and the Revenue Commissioners.
I have also included a catch-all provision to deal with updating or amending legislation which provides that disclosure can be made to any other public body on whom or which regulatory or supervisory or investigative functions stand conferred for the time being. For example, it has been suggested to me that I ought expressly to have listed the Competition Authority and the Criminal Assets Bureau. It has also been suggested that I should not have expressly listed any body or person but should rather have a catch-all, governing provision which enabled the widest possible scope of application of the Bill. I would be interested to hear the Minister's view on that point.
Section 2 lists what are categorised as "protected disclosures". This is based on the recently enacted British legislation and it encompasses any information which, in the reasonable belief of the employee in question, tends to show the commission of a criminal offence, a breach of legal obligation, a miscarriage of justice, the endangerment of the health or safety of any individual, damage to the environment or the deliberate concealment of any information relating to those categories.
Section 3 sets out to whom disclosure may be made. It makes it clear that, in the first instance and so far as practicable, disclosure should be "in house". An employee should consider making a protected disclosure of information to his or her employer; where a third party might be involved, to that third party; if he or she is an employee of a public body, to the Department of State under the aegis of which the public body operates; and where regulatory, supervisory or investigative functions are vested in another State body, to an officer of that body. There is also protection for seeking legal advice in relation to an employee considering his or her options in such a situation.
It is only if the relevant failure on the part of an employer is, in the words of the Bill, of "an exceptionally serious nature" and, in all the circumstances of the case it is reasonable to do so, that an employee would be protected under this Bill for having delivered an as yet uninvestigated disclosure into the public domain. For example, the persons most likely to receive information under that provision would be a Deputy or a journalist. The courts have ruled on what would apply if the information was disclosed to a Member of this House, in a case stemming from the Beef Tribunal which involved Deputy Spring and myself, in which a ruling of Mr. Justice Hamilton, as he then was, was subsequently judicially reviewed. The view has been endorsed that not only should a Member of this House not disclose the identity of his or her informant but, in the circumstances encompassed by that judgment, he or she has a positive duty not to do so. The debate on this section will, therefore, probably concentrate on the role of the journalist who mediates such information into the public domain in these exceptionally serious circumstances.
In judging whether it was reasonable to make such a public disclosure, the Bill provides that regard should be had to whether the employee made the disclosure for personal gain; whether he or she reasonably believed that a penalty or detriment might otherwise have arisen; whether he or she reasonably believed that there was no appropriate supervisory or regulatory body to which to report; whether the employee reasonably believed that relevant evidence might be concealed or destroyed; whether the employee had previously made a disclosure of much the same sort of information and, if so, the outcome; and the identity of the third person to whom disclosure was made.
Section 4 provides protection from civil liability for employees who make protected disclosures. In other words, they cannot be sued for breach of any express or implied term in a contract of employment relating either to official secrecy or the business confidentiality of the employer. Section 5 protects employees from discrimination in their employment, having made a protected disclosure, up to and including dismissal. The avenue of redress for such an employee is by way of complaint to a rights commissioner, with provision for further appeal to the Employment Appeals Tribunal. The Commissioner or, on appeal, the Employment Appeals Tribunal can direct the employer to take specific steps such as, for example, the reinstatement or re-engagement of an employee or the payment of compensation.
The final sections deal with standard and somewhat technical matters to assimilate the new legislation into the general employment protection code. Framing a code that would give expression to the principles behind this Bill and supporting it in the discussions between the social partners would probably do as much as the legislation to change the culture that exists at present. It would attract the allegiance of both sides of industry. I have received a fair amount of criticism for the provision for reinstatement and re-engagement in the Bill or, alternately, compensation since the Bill went into the public domain. Re-engagement or reinstatement may not be practicable in many situations. To use a phrase from another area of law, there may be an irretrievable breakdown of relationships and it may be probable that re-engagement is not practicable. Therefore, the quantum of compensation is probably underjudged in the Bill, given the implications for a whistle blower in certain circumstances, based on United States surveys, for example. The cost to one's career can be extremely severe.
There is in Irish culture and society, including Irish business and political culture, a strong tradition of not only turning the blind eye but also of regarding whistle blowing as actually undesirable and even heinous. Ideas of citizenship, civic purpose, even ethics and ethical behaviour are not deeply rooted in some sections of Ireland's business community and in parts of the political sys tem. The pursuit of the quick buck, the nod and wink, cutting corners, whether in dealing with individuals, the State or customers or clients, is unfortunately too much part of some sections of business and certain parts of political life.
The secret arrangement, the private understanding, the gentle, and not so gentle twist of the arm and even the occasional £50,000 appear not to be unheard of in some areas of commerce and certain parts of political life. All this does not simply describe the separate worlds of commerce and politics. It is also a feature of the interaction between politics and public administration on the one hand and business on the other.
Thankfully this is not Sicily. The space in which corruption germinates is not that between politics and public administration and organised crime. However, our circumstances might actually be argued to be worse in that professedly law-abiding people, bodies and organisations have this underside that we have now spent quite a few years and many tens of millions of pounds examining, investigating and pursuing. The hair on the back of the Tánaiste's neck has been made to rise by what she has uncovered in her investigations.
There are those who say that it is all history, that it is in the past and should be forgotten, that tribunals and forensic examinations are self-flagellation, inappropriate to our successful economy and even unpatriotic. We should, according to this view, get on with things, be positive and put it all behind us.
Those of us who continue to raise issues of accountability are accused of raking over old coals, being engaged in mischief and pursuing private agendas. However, who is really pursuing private agendas and is it all in the past? We have just seen a Taoiseach's adviser having to resign. We have also seen a major benefactor of Fianna Fáil unlawfully demolish a piece of our architectural heritage in the good old style of the 1960s, reducing a streetscape to rubble on a bank holiday weekend morning. We have a Tánaiste who is in danger of disappearing under a mountain of investigations under the Companies Acts. Oireachtas committees are working overtime in conducting hearings and investigations into a range of what might elegantly be called phenomena. We have seen a former public official being arrested coming off a flight from the Isle of Man with a bagful of money. There is more – much more. The Minister for Finance got off the leash on "Questions and Answers" and ridiculed the preoccupation with purging these events. This is a reversion to type for the same Minister who pooh-poohed the RTE disclosures of wrongdoing in the banking system.
Notwithstanding the Minister for Finance's well known attitude, I welcome the Government's response.