The department that runs much of Australia’s Parliament House is “deeply dysfunctional” and its former secretary, Carol Mills, undermined her standing as a credible witness, a Senate inquiry has found.
The damning report by the Senate’s finance and public administration committee sheds new light on the circumstances that led to Mills losing her job as head of the Department of Parliamentary Services (DPS) last week.
Mills was previously in the running for the role of clerk of the UK House of Commons, but the Speaker John Bercow was forced to scrap his favoured appointment last year following a backlash from MPs who were concerned about her performance in Canberra and ability to protect Westminster traditions.
The finance and public administration report, published on Tuesday, raised serious concerns about DPS management, including the “flawed” process to award a $30,000 photographic contract to one of Mills’s neighbours – a conflict of interest she did not formally declare in writing.
And it reaffirmed concerns that Mills had provided contradictory evidence to parliament about her knowledge of the use of the building’s security camera footage as part of the investigation into a DPS employee.
The interim report, which was drafted before Mills’s abrupt departure was announced on Friday, said the committee intended to call her to another hearing for further questioning about “inconsistencies” in her testimony.
It said the situation had “seriously eroded her standing as a witness before the committee and casts doubt over other evidence provided by Ms Mills”.
“Overall, the evidence to the committee so far demonstrates that DPS, as currently managed, is deeply dysfunctional,” said the committee chaired by the Liberal senator Cory Bernardi.
“After the committee drafted this report, and prior to its tabling, the committee was advised that Ms Mills ceased employment as secretary of DPS.”
The committee said the commissioning of photographs to mark the 25th anniversary of Parliament House in Canberra in 2013 epitomised the failings that still existed within DPS.
Mills had initially argued Anne Zahalka was selected because of her international reputation and experience in photographic commissions, but subsequently revealed she knew her “because we live in the same neighbourhood in Sydney and I have met her a couple of times at Christmas functions”.
Mills admitted she had discussed the potential commission with Zahalka over Christmas in 2012, the report said, but maintained that she was unaware of anyone at DPS discussing the matter with the photographer prior to 14 June 2013 when an officer phoned to gauge interest in the project.
However, the committee found evidence that undermined that account.
It said a Lake Macquarie City Art Gallery publication in May 2013, a month before the documented phone call from DPS, contained an interview with Zahalka in which she said she had “been invited to do a commission about the public and private areas of Parliament House for their forthcoming anniversary”.
The committee said this interview – which in effect was an announcement of the planned photographic work – added to its broader concerns about a three-month gap in documentation about the commissioning process.
“While the committee does not have any evidence of wrongdoing, the fact that this situation has arisen in an already flawed process does not reassure the committee that DPS is developing a strong culture of probity and accountability,” the report said.
Amid growing scrutiny of Mills’s performance, the DPS was informed last week by parliament’s presiding officers, the house speaker Bronwyn Bishop and Senate president Stephen Parry, that Mills was no longer the secretary. Her employment ended on 21 April.
Mills wrote to staff after the announcement, thanking them for their “personal support over recent difficult times”.
The finance and public administration committee has been working towards a 25 June deadline to complete a final report about issues with DPS management, but decided to write an interim report outlining its concerns.
Having flagged its interest in asking further questions for Mills, the committee said it would work with parliament’s presiding officers to improve “the management and operation of DPS”.
The committee complained about a lack of progress on implementing recommendations of a 2012 report on the DPS.
Mills began as secretary in mid-2012 and was championing a “transformation process”, but the auditor general Ian McPhee said progress had been at the “slower end”.
The committee said this assessment was “generous” and pointed to a recent report by Australian National Audit Office which found there were “systemic gaps and weaknesses” in the awarding of contracts by the DPS which included “out-of-date guidance material, inadequate training [and] poor record-keeping practices”.
The report is likely to embolden the British MPs who spoke out against Mills’s potential appointment as clerk of the Commons. The selection, championed by Bercow, caused a row in the UK and Australia.
Bercow lost the battle; the appointment process was suspended in September and then terminated in December. Bercow said in December that Mills would not stand again.
