Chapter 6: Gifts, Benefits, Hospitality, Sponsored Travel and Sponsorship

This chapter sets out the department's policy on accepting and declaring gifts, benefits, hospitality, sponsored travel and sponsorship.

Staff should contact the Conduct and Ethics Unit (conduct@dfat.gov.au) if they require clarification on the contents of this Manual or if they are uncertain about the ethical implications of a proposed course of action.

6.1 Gifts and Benefits

What do I need to do?

All Staff

Designated Approvers

6.1.1 All employees (APS and LES) and contractors must exercise judgment and caution in regard to any gifts or benefits they may be offered in connection with their official duties or because of their position in the department. Gifts refer to physical items with a monetary value, including cash, goods, services or vouchers for goods and services. Benefits refer to prizes, special offers or customer-specific discounts on goods, services or other assets.

6.1.2 As a general rule, employees and contractors should, wherever possible, not accept gifts or benefits offered in connection with their official duties or because of their position in the department. Doing so may give rise to conflicts of interest or perceived conflicts of interest – for example, if offered by a company seeking business with the department. Improperly accepting gifts or benefits may also compromise Australia’s reputation, as well as the department’s reputation for impartiality and professionalism.

6.1.3 Under the APS Code of Conduct and the standard LES Code of Conduct, employees must not make improper use of inside information, or their duties, status, power or authority in order to gain, or seek to gain, a benefit or advantage for themselves, or for any other person. Contractors must behave similarly in accordance with provisions in their contracts.

6.1.4 At the same time, the department recognises that circumstances arise, particularly overseas, where no conflict of interest could reasonably be inferred from accepting a gift or benefit, or where refusing a gift or benefit may cause offence to a degree which may place the department, the post or Australia in a poor light.

Reportable and Non-Reportable Gifts

6.1.5 Staff may retain certain gifts for personal use without seeking official approval. These gifts are called "non-reportable" gifts and include:

6.1.6 HOMs/HOPs may issue additional guidance to staff, based on local custom and practice, elaborating on this list of non-reportable gifts. In setting local standards in this way, HOMs/HOPs should aim to reinforce the intent of the department's policy on gifts and benefits, which is to ensure no real or perceived conflicts of interest and to preserve the reputation of Australia, the post and the department.

6.1.7 All other gifts are “reportable”. All employees and contractors must report all such gifts accepted in connection with their official duties in accordance with the procedures set out in sections 6.1.16-20 of this Manual. These gifts must be reported regardless of their value.

6.1.8 Employees and contractors must never accept money as a gift in connection with their official duties or because of their position in the department. In extraordinary circumstances, involving particular cultural sensitivity where receipt of money as a gift is unavoidable, the recipient must fully report the gift and the circumstances of the gift in accordance with the procedures set out in sections 6.1.16-20 of this Manual, regardless of the value. The gift must not be retained by the recipient, but receipted as “Administered Revenue” (see section 6.1.25 of this Manual).

6.1.9 Staff should contact the Conduct and Ethics Unit at conduct@dfat.gov.au if they require clarification on what constitutes a reportable gift.

Reportable and Non-Reportable Benefits

6.1.10 Staff may accept certain benefits for personal use without seeking official approval. These benefits are called "non-reportable" benefits and include:

6.1.11 HOMs/HOPs may issue additional guidance to staff, based on local custom and practice, elaborating on this list of non-reportable benefits. In setting local standards in this way, HOMs/HOPs should aim to reinforce the intent of the department's policy on gifts and benefits, which is to ensure no real or perceived conflicts of interest and to preserve the reputation of Australia, the post and the department.

6.1.12 All other benefits are “reportable”. All employees and contractors must report all such benefits accepted in connection with their official duties to designated approvers in accordance with the procedures set out in sections 6.1.16-20 below. These benefits must be reported regardless of their value.

6.1.13 Reportable benefits include:

6.1.14 Employees and contractors must never accept discounts on liquid assets (such as shares) as a benefit in connection with their official duties or because of their position in the department.

6.1.15 Staff should contact the Conduct and Ethics Unit at conduct@dfat.gov.au if they require clarification on what constitutes a reportable benefit.

How to Report Gifts and Benefits to Designated Approvers

6.1.16 All employees (APS and LES) and contractors must report all reportable gifts and benefits regardless of their value using the Gift / Benefit / Hospitality / Sponsored Travel Report Form (Form C at the end of this Manual). They must send a hard or electronic copy of the completed Report Form to their designated approver within 14 days of accepting the gift or benefit. Designated approvers are listed in Schedule A at the end of this Manual.

6.1.17 When completing Form C, staff must describe the gift or benefit, the circumstances in which it was received and why it was not refused. They must propose whether to retain the gift or benefit for personal use or whether the gift or benefit should become the property of the Commonwealth (i.e. public property).

6.1.18 Form C also requires staff to provide a value for the gift or benefit in Australian dollars and (where relevant) local currency. When valuing a gift or benefit, the following principles apply:

6.1.19 Staff may provide an informal estimate where they are satisfied that the wholesale value of the gift or benefit from an official source is below AUD500 or from a private source below AUD200. The designated approver may request a formal valuation, where he or she is not satisfied with the informal valuation and the recipient seeks to retain the gift or benefit for personal use.

6.1.20 Where the wholesale value of the gift or benefit is likely to be higher than the limits set out in section 6.1.19 and the recipient seeks to retain the gift or benefit for personal use, the recipient must provide a formal valuation with Form C. A current published valuation for the gift or benefit (such as a buyer's guide or a commercial catalogue) is sufficient for this purpose. Where a current published valuation is not available and an independent valuation is required, staff may deduct the cost of that valuation from the assessed wholesale value of the gift.

Retaining a Gift or Benefit for Personal Use

6.1.21 A designated approver may permit the recipient to retain a reported gift or benefit for personal use if he or she is satisfied that the wholesale value of the gift or benefit is below AUD500 (from an official source) or below AUD200 (from a private source).

6.1.22 Where the wholesale value of a reported gift or benefit is higher than the limits set out in section 6.1.21, a designated approver may permit the recipient to retain it for personal use on the condition that the recipient pays to the department the difference between the allowable limit and the wholesale value of the gift or benefit, plus GST on the difference (see example below). The recipient's divisional coordinator (for staff based in Australia), SAO (for staff at post) or STO administration (for staff at STOs) will raise a debt for the recipient against general ledger code 19500 and internal order 240540.

Example:

Wholesale value $650
Less cost of independent valuation ($50)
Less allowable limit ($500) government source)
Balance $100
+ GST on the difference $10
Total payable by recipient $110

6.1.23 Regardless of its value, a designated approver may refuse a request to retain a reported gift or benefit for personal use if the circumstances in which the gift or benefit was accepted may give rise to a real or perceived conflict of interest, or if those circumstances may compromise the reputation of Australia, the department or the post.

Official Use, Storage or Disposal of Gifts or Benefits

6.1.24 If a designated approver determines that a reported gift or benefit is not to be retained by the recipient for personal use, the gift or benefit becomes the property of the Commonwealth (i.e. public property). Public property is to be used, stored and disposed in accordance with instructions in the department's Finance Management Manual (FMM). This includes (but is not limited to) the requirement to record all gifts or benefits valued at AUD2,000 or over in the Asset Register, and to post the value of the item to general ledger code 14010 ("Resources Received Free of Charge").

Gifts of Money and Proceeds from the Sale of Gifts or Benefits

6.1.25 There are no circumstances in which a gift of money or the proceeds from the sale of a gift or benefit may be retained by the recipient. The department classifies these as a windfall to the Commonwealth. Consistent with section 31 of theFinancial Management and Accountability Act 1997(FMA Act) and FMA Regulations 15 and 16, gifts of money and proceeds from the sale of gifts or benefits should not be retained by the department or individual work units, but receipted as "Administered Revenue".

Return and Storage of Completed Report Forms

6.1.26 Once a designated approver has made a decision on how a reported gift or benefit should be treated, the recipient should be advised of the outcome and be given a copy of the decision.

6.1.27 If payment for excess value of the gift or benefit, the designated approver must advise the recipient's divisional coordinator (for staff based in Australia), SAO (for staff at post) or STO administration (for staff at STOs) to raise a debt for the recipient against general ledger code 19500 and internal order 240540.

6.1.28 Completed Report Forms are auditable documents. All designated approvers must maintain a file in which original completed Report Forms and relevant correspondence are kept.

Case Study — Gifts and Hospitality

I have observed colleagues accepting gifts and hospitality from contractors engaged by DFAT, including invitations to sporting events and meals at expensive restaurants. Are they in breach of the APS Code of Conduct?

If your colleagues did not report the gifts and hospitality, they may be in breach of the APS Code of Conduct.

In accordance with DFAT's policy on gifts and benefits, employees and contractors should, whenever possible, not accept gifts offered in the course of their official duties. When this is unavoidable, the procedures set out in DFAT's policy on gifts and benefits should be followed. This is to avoid any real or perceived conflict of interest.

In this case, your colleagues should have reported the gifts to their designated approver within 14 days of receipt by completing a Gift / Benefit / Hospitality / Sponsored Travel Report Form (Form C at the end of this Manual). They should have set out details of the gifts, the donors, why it was not refused and the value of the gifts.

Given that the hospitality was in expensive restaurants and there is a commercial relationship between DFAT and the hosts, your colleagues should have reported the hospitality to their designated approver by completing a Report Form and they should have made every effort to do so before accepting the offer of hospitality.

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6.2 Hospitality

What do I need to do?

All Staff

Designated Approvers

6.2.1 Hospitality refers to invitations to work-related meals, social functions or sporting or cultural events where the costs are met wholly or substantially by the host. The term work-related refers to events where an invitation is based on the recipient's official position with the department rather than on an exclusively personal relationship or connection.

6.2.2 The offer and return of hospitality is an integral part of conducting business overseas and in Australia. Nevertheless, employees and contractors must exercise judgment and caution about offers of hospitality.

6.2.3 This is particularly important in the case of offers of hospitality from private or commercial sources. Accepting inappropriate offers of hospitality may give rise to conflicts of interest or perceived conflicts of interest - for example, where the host is tendering for a contract with the Commonwealth or is seeking an Australian visa for a relative. Accepting inappropriate offers of hospitality may also compromise the reputation of Australia, the department or the post.

6.2.4 Employees (APS and LES) and contractors should, wherever possible, avoid hospitality which carries an implication that a favour is expected in return, or which falls outside the normal pattern of hospitality appropriate to their official position and responsibilities.

6.2.5 As a general rule, employees and contractors may accept moderate hospitality from official sources such as an international or intergovernmental agency, another government, another Australian government agency, an educational institution, a non-profit humanitarian organisation or a broad-based industry group without reporting it to their designated approver.

Reporting and Approving Offers of Significant Hospitality

6.2.6 All employees (APS and LES) and contractors must report offers of significant hospitality they wish to accept by using the Gift / Benefit / Hospitality / Sponsored Travel Report Form (Form C at the end of this Manual). They must send a hard or electronic copy of the completed Report Form to their designated approver wherever possible in advance of receiving the hospitality, but in any case within 14 days of receiving the hospitality. Designated approvers are listed in Schedule A at the end of this Manual.

6.2.7 Because the value of hospitality often cannot be determined, the criteria for deciding whether hospitality offered is significant and whether it should be accepted are:

whether the hospitality offered would fall outside the normal pattern of hospitality appropriate to a staff member's position and responsibilities;

6.2.8 Hospitality in the form of a gift (for example, tickets to sporting or cultural events) or in the form of sponsored travel should be reported in accordance with the relevant procedures in section 6.1 and section 6.3 of this Manual.

6.2.9 Once a designated approver has made a decision on whether hospitality should be accepted, the relevant staff member should be advised of the outcome and be given a copy of the decision.

6.2.10 Completed Report Forms are auditable documents. All designated approvers must maintain a file in which original completed Report Forms and relevant correspondence are kept.

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6.3 Sponsored Travel

What do I need to do?

All Staff

Designated Approvers

6.3.1 Sponsored travel refers to cases where, in order to enable work undertaken for the department, the costs of transport, accommodation and/or travel/living expenses are met from sources other than official funds or a staff member’s own resources.  (It does not refer to situations where a staff member is seconded to or provides a specific service to a body or organisation and cost recovery is appropriate. It does not refer to situations where a contractor’s own company pays for travel to enable work undertaken for the department.)  As with any other gift or benefit staff may be offered in connection with their official duties or because of their position in the department, all employees (APS and LES) and contractors must exercise judgment and caution in regard to any offers of sponsored travel.

6.3.2 As with any other gift or benefit, improperly accepting offers of sponsored travel may give rise to conflicts of interest or perceived conflicts of interest, and may compromise the reputation of Australia, the department or the post. As a general rule, employees and contractors should not accept offers of sponsored travel, particularly from private or commercial sources. This policy on sponsored travel is based on the principles set out in Chapter 12 of the APSC’s APS Values and Code of Conduct in Practice, namely that:

6.3.3 Under the APS Code of Conduct and the standard LES Code of Conduct require, employees must not make improper use of inside information, or their duties, status, power or authority in order to gain, or seek to gain, a benefit or advantage for themselves, or for any other person. Contractors must behave similarly in accordance with provisions in their contracts.

6.3.4 At the same time, the department recognises that circumstances arise, particularly overseas, where no conflict of interest could reasonably be inferred from accepting an offer of sponsored travel, or where there may be operational benefit in accepting an offer of sponsored travel.

Reporting and Approving Offers of Sponsored Travel

6.3.5 All employees (APS and LES) and contractors must report offers of sponsored travel they wish to accept by using the Gift / Benefit / Hospitality / Sponsored Travel Report Form (Form C at the end of this Manual). They must send a hard or electronic copy of the completed Report Form to their designated approver before accepting the offer of sponsored travel. They must not undertake the sponsored travel before a decision from their designated approver. Designated approvers are listed in Schedule A at the end of this Manual.

6.3.6 Sponsored travel may be approved when offered by reputable official sources such as an international or intergovernmental agency, another government, another Australian government agency, an educational institution, a non-profit humanitarian organisation or a broad-based industry group. For example, there are some recognised instances where travel opportunities are offered on a general rather than an individual basis, such as industry familiarisation tours, or where an organisation such as the World Health Organisation sponsors participants in a seminar.

6.3.7 Due to the risks involved, stricter criteria apply to offers of sponsored travel from private or commercial sources. APS and LES employees should generally not accept offers of sponsored travel from private or commercial sources – where the Commonwealth can pay for official travel, it should pay. Contractors should generally not accept offers of sponsored travel from private or commercial sources – where the Commonwealth or the contractor's own company can pay for the travel, they should pay.

6.3.8 However, sponsored travel offered by private or commercial sources may be approved where:

6.3.9 Criteria for approving all sponsored travel are whether:

6.3.10 Once a designated approver has made a decision on whether an offer of sponsored travel should be accepted, the relevant staff member should be advised of the outcome and be given a copy of the decision.

6.3.11 Where sponsored travel is approved, the designated approver must advise Financial Services Section (FSS) (for staff based in Australia), SAO (for staff at post) or STO administration (for staff at STO) to ensure any necessary adjustments are made to allowances paid to the travelling staff member.

6.3.12 Completed Report Forms are auditable documents. All designated approvers must maintain a file in which original completed Report Forms and relevant correspondence are kept.

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6.4 Corporate Sponsorship

What do I need to do?

All Staff

6.4.1 Corporate sponsorship can be a valuable source of income for the department, particularly for our public diplomacy and trade advocacy activities. Nevertheless, all employees (APS and LES) and contractors must exercise judgment and caution when seeking or accepting corporate sponsorship.

6.4.2 Seeking or accepting inappropriate corporate sponsorship may give rise to conflicts of interest or perceived conflicts of interest - for example, where the source of the sponsorship is seeking business with the department or the Government. Inappropriate corporate sponsorship may also compromise the reputation of Australia and the department - for example, where the source of the sponsorship is engaged in activities which do not meet community standards, or are in conflict with government policy, such as a tobacco company.

6.4.3 All employees and contractors must comply with the department's policy on sponsorship as set out in Chapter 8 of the department's Finance Management Manual (FMM).