LOST PRIVILEGES TO BE RESTORED
Introduction Restrictions on the privilege against self-incrimination Other privileges removed Legislative outcome Select committee inquiry Conclusion
Introduction
Whilst not strictly a `recurring issue' in the sense of the rest of this report, the Social Welfare Reform Bill (No. 3) 1993 illustrated a legislative proposal that needed to be revisited during the current reporting period because of serious flaws in the original bill. The Bill introduced a number of significant amendments to the Social Security Act 1964, and was one of the bills discussed in Issues of Principle LAC Report No 8.
The LAC's submission on the Bill was particularly concerned with the increased breadth of the powers that the Bill would confer on the Director-General of Social Welfare to require any person to provide information to the Department of Social Welfare or a specified employee of the Department. (7) This was the intention of prposed new section 11 of the Social Security Act 1964) The Committee did not question the existence of an appropriately confined power to compel the provision of information with the purpose of ensuring that decisions about benefits were made properly. In that sense the freedom of the individual to remain silent could quite properly be limited. Rather, the LAC was concerned about the extent of the power and, in particular, its possible overriding of established privileges.
Restrictions on the privilege against self-incrimination
Clause 4 of the Bill substituted new sections 11 and 11A into the 1964 Act. New sections 11(4) to 11(7) were of particular relevance as they provided exceptions from the broad obligation to supply information (stated above) by enabling a person to refuse to disclose that information on the grounds of certain privileges. However, the privilege against self-incrimination set out in new section 11(4) was a significantly restricted version of the usual common law privilege against self incrimination. The Hon Justice McMullin, in the Court of Appeal decision of New Zealand Apple and Pear Marketing Board v Master & Sons Ltd [1986] 1 NZLR 191, at page 193, summed up this privilege:
The law is well settled. It is a general rule that 'no one is bound to criminate himself,' in the sense that he is not to be compelled to say anything which 'may tend to bring him into the peril and possibility of being convicted as a criminal'.
New section 11(4) protected only persons suspected of the offences specified in new sections 11(4)(a) and 11(4)(b). But, as the above quotation indicates, the common law privilege has no requirement that the person asking questions or requesting information already suspects offending before the privilege can be asserted. Indeed, the basic philosophy behind the privilege is that it is a protection against an individual being forced either to establish in the mind of the questioner that the individual is an offender, or to confirm that allegation. The LAC considered that to limit the privilege in the way proposed in new section 11(4) was thus a novel and significant restriction.
Further, no justification for the restriction was given in the Bill nor in the arguments made in support of the Bill. The LAC suggested that the restriction was unsatisfactory in both principle and practice. The Committee recommended to the select committee that the restrictions on the ability to assert the privilege against self-incrimination be reconsidered.
Other privileges removed
The LAC pointed out that existing section 11 preserved all the privileges that would be available to a witness in a court of law. These are the privilege against self-incrimination, legal professional privilege, public interest immunity, the privilege for "without prejudice" communications, privilege between spouses, religious privilege, medical privilege, and the protection available to other confidential relationships under the court's discretion in section 35 of the Evidence Amendment Act (No. 2) 1980.
This Bill was to repeal existing section 11 and provided specifically only for the availability of the privilege against self-incrimination and legal professional privilege. Even then, these privileges were truncated versions of those provided under existing section 11. The Bill was silent on the application of the other privileges, and no justification or reasons were given for removing them.
The LAC's view was that this silence created unnecessary uncertainty and it suggested to the select committee that the status of these other privileges be clarified in the Bill. The common law rule is that the privileges should be taken to operate unless there is a clear intention to exclude them. Given the unlikelihood of these other privileges providing a significant impediment to the investigation of welfare fraud, there seemed to be little reason to limit the protection generally accorded to those other relationships through the law of privilege. The Department was not able to provide any information to support the overriding of the privileges.
The Legislation Advisory Committee, therefore, recommended that the Bill be amended to include a general provision clearly incorporating the protection of all privileges available to a witness in a court of law, subject to the specific limitation on legal professional privilege.
Legislative outcome
Clause 4 was enacted as section 3 of the Social Security Amendment Act (No. 3) 1993, which modified, in new section 11(4) of the Social Security Act 1964, the privilege on the grounds of self-incrimination along the lines recommended by the LAC. However, it did not, as recommended, increase the categories of privilege recognised by the 1964 Act to include public interest immunity, the privilege for "without prejudice" communications, medical privilege, religious privilege, privilege between spouses and the protections available to other confidential relationships under the court's discretion in section 35 of the Evidence Amendment Act (No. 2) 1980. Rather, the application of these privileges was expressly excluded.
Select committee inquiry
Following the enactment of new section 11, policy changes were announced by successive Ministers of Social Welfare. A press release issued by the then Minister, the Hon Jenny Shipley MP, on 5 November 1993 stated that requests by the Department of Social Welfare for information under new section 11 would not be made to doctors until the section had been reconsidered.
A subsequent Ministerial Direction by the current Minister, the Hon Peter Gresham MP, to the Director-General on 22 December 1993 was to the effect that, notwithstanding anything in new section 11(7) of the Social Security Act 1964 (8) This provides that "subject to sections 11(4) to 11(6) of the Act, no person shall be excused under this section from providing any information or producing any document that would be privileged in a Court of Law"), when the Director-General has requested information or required production of a document, and any person has refused to supply that information or to produce that document because of a claim of privilege, that he or she would be successfully able to assert if he or she was asked for that information or to produce that document in a Court of law, the Director-General was not prosecute that person for any offence under section 11(3) (9) These offences relate to a refusal or failure to comply with, or falsely furnishing information relating to, a notice to provide information under new section 11) of the Social Security Act 1964 in respect of that refusal. (10) For the text of that dierection, see the New Zealand Gazette, No 1, 13 january 1994, p.58.)
On 15 May 1994, the Social Services Select Committee, at the request of the Minister of Social Welfare, resolved to conduct an inquiry into the privilege provisions contained in section 11 of the Social Security Act 1964. The terms of reference of the inquiry were:
To examine the Department of Social Welfare's administration of the Social Security Act 1964, with particular reference to:
- the privilege provisions contained in section 11 of the Social Security Act 1964 prior to the 1993 amendment; and
- the impact of the 1993 amendment
and to report its findings and recommendations to the House of Representatives.
In evidence to the select committee, the Department of Social Welfare estimated that approximately 104 799 requests for information under section 11 would be made annually, and that the number of privilege claims made in terms of new section 11 would be no more than 12. The Department also advised that had been unable to locate copies of any specific advice that was given to the Minister prior to the Cabinet paper that sought the 1993 amendments to the Social Security Act 1964. The select committee indicated that this placed a constraint on its ability to judge whether the changes to the privilege provisions under section 11 were justified. (11) see generally, Report of the Social Services select Committee on the Inquiry into the Privilege provisions of Section 11 of the Social Security Act 1964 (I. 12A, 1994), p. 4.)
In the select committee's view, policy shifts under the different Ministers, combined with the Department's failure to state clearly the departmental policy relating to the ability to assert privilege, had led to public confusion over the status of the Department's ability to compel information under the 1964 Act. The shifts in policy had also contributed to the Department's inability to compile adequate statistical data in this area.(12) Ibid)
In its report, the select committee's recommendations with respect to privilege were that:(13) Ibid)
- The legislation be amended so that the privileges available to witnesses in a court of law are restored, and that the limitation on legal professional privilege regarding solicitors' trust accounts provided in section 11(5) be retained; and
- The Government expand the application of privilege to a wider range of comparable relationships and communications.
The Social Services Select Committee also noted that the Law Commission will be reporting presently on the broader issues of privilege, and recommended that the Government give urgent consideration to the issues raised in the Law Commission's report.
Conclusion
As the result of the select committee's report, Supplementary Order Paper No. 84 was introduced and referred for consideration with the Bill. The LAC made further submissions on the SOP. At the time of writing (March 1996), the bill was set down for committal.