Kevin Rudd (Griffith, Australian Labor Party, Shadow Minister for Foreign Affairs and Trade and International Security) Share this | Hansard source

It is a very basic question for us to put to the government: have you investigated what happened to the money? You are all outraged by this question. Well you might be. You have often stood up here in this place and paraded yourselves as the world’s best friends of Israel. When it comes to this act of monumental national security policy incompetence, allowing $300 million to go through to Saddam’s slush fund, knowing at the time that Saddam was funding suicide bombers, it frankly leaves people in this country speechless as to how you can stand in this parliament and attempt to hold your head up high.

When it comes to this most recent matter for debate, however, it is important that the parliament focus on these new developments. What happened in the critical events of 1999? I would draw the attention of honourable members to this fact: the AWB was privatised as of 1 July 1999. This entire debate has been conducted in terms which suggest that a problem only arose with the AWB once it had been off there in the private sector. You are wrong. Evidence has already been presented to the Cole inquiry in Sydney that, when the AWB was still fully owned by the Howard government, there was email traffic between AWB staff about how the first set of kickbacks could be arranged. This is while it was wholly owned by the mob opposite, the Howard government. If you disbelieve me on this, I will read you one short extract from one email. This dates from 24 June 1999, referring to an earlier visit to Iraq. Here you have an AWB representative, in a part of the email headed ‘Contract terms and conditions’, writing as follows:

IGB—

that is, the Iraqi Grains Board—

have requested that the offers are submitted CIF—

with insurance and freight—

free in truck, Iraq. The cost of this will be USD12 per tonne which the supplier adds to their offer.

Interesting—

Hence this part is not an issue.

I am not sure about that—

The problem which still needs to be resolved is the payment mechanism, as all Iraq accounts are frozen. IGB have stated that we will be required to pay the maritime agents, and one possible way would be to pay this to an Iraq bank in Amman. IGB will provide details of the banks we can pay this through.

That has already been provided by way of evidence to the Cole inquiry. The critical thing, though, for the attention of the parliament and the nation is this: that transaction occurred within the AWB while the Howard government still owned the AWB. It relates to a visit to Iraq by AWB representatives while you mob still owned them.

I put this to you: around this country for the last decade or so we have seen multiple royal commissions and commissions of inquiry into allegations—some substantiated, others not—of malfeasance by various corporations owned by state governments around Australia such as the Labor governments of Western Australia, Victoria and South Australia. They included the State Bank inquiry and so on. If this matter was unearthed in relation to any state Labor government concerning a corporation owned by that state Labor government, you would be howling them out of office. This scam, this rort, which became a $300 million cross-subsidisation exercise for the Saddam Hussein military machine, began when you owned the AWB. It was yours. I do not hear any statements of denial from those opposite. The evidence is clear-cut. No wonder you hang your heads in shame when you know that, this time, there is no excuse. You actually ran the show; it was 100 per cent in your possession.

The clock rolls on to the events later in 1999. It is important to piece these critical events together. There is a mission to Iraq in June 1999 by AWB officials when AWB is still owned by the government. In July 1999 there seems to be another mission, and that is when the first corrupt contracts are signed or agreed. There is a further AWB mission to Iraq in about October or November. The payments actually start flowing in October or November 1999 and, interestingly, it is one month later in December 1999 that this mob get the warning from the government of Canada. It only took a month, and do you know why? I suspect the Iraqis, having got the AWB on board, went off to the Canadians and said, ‘Look, the Australians are on board with this, Bob’s your uncle!’—sorry, Saddam’s your uncle—‘and you can be in on the joke as well.’

Except the government of Canada did something different. They actually went to the United Nations and asked, ‘Is this okay?’ That was the right thing to do; something you mob have never done. They were told unequivocally that this was a problem. Furthermore, the United Nations then raised it with this government. They did it in January and March of 2000, and, in a continuing exercise of negligence in the discharge of your national security responsibilities, you dismissed those concerns—it is as clear as day that that is what happened.

There is one key event, however, in the early stage of this unfolding saga which we must focus on, because this minister refused to focus on it in question time today. After the AWB came back from Iraq in about July of 1999, we have evidence from the Cole commission of inquiry that they then went to Canberra. They went to Canberra for discussions with whom? With this minister’s department: DFAT. And by this stage it was this minister’s department, because by then he had become the trade minister. We know from evidence presented to the Cole commission of inquiry that this was not just an ordinary visit. In fact, if I look at some of the evidence which has been presented at the inquiry, there are multiple references to this event occurring and its significance. For example, there is a clear reference in the testimony of Mr Rogers, who was then the CEO of the AWB, that AWB representatives went to DFAT to talk to them about what had gone on in their recent visit to Iraq. Furthermore, there was a reference in the inquiry evidence that, in fact, this was necessary so that ‘people with DFAT in Canberra could be consulted before we, the AWB, proceeded’—that is, with these new contract arrangements.

There was evidence presented to the inquiry that there were folk going to Canberra from the AWB to dialogue with the Department of Foreign Affairs and Trade to ‘ensure that things were correct’. Furthermore, Mr Rogers said: ‘I think, if my memory serves me correctly, if there was a change to any contracts we were obligated to pass that through Canberra.’

I draw the attention of all members to the fact that this was at the very beginning of this saga. This meeting between the AWB and the department for which this minister is responsible occurred in the second half of 1999 and before the first corrupt payments were made. They did not start flowing until November of that year. This was the core opportunity for this minister and the Minister for Foreign Affairs, who was very keen that we directed all questions to the Minister for Trade in question time today. This minister and his partner, the Minister for Foreign Affairs, had at that stage a clear-cut opportunity to ensure that this scandal went no further.

However, in question time today I asked this minister on at least three occasions to give us some details about the meeting. When did it occur? Who was there from the Department of Foreign Affairs and Trade? Who was there from the AWB? What was discussed about these new contract arrangements? These are critical questions when it comes to this point: at the end of the day, how do we establish whether you in any faint respect discharged your national security obligations, given to you by resolution 661 of the Security Council? Had you done your job, five years later we would not be having this debate; it would be a debate being had in some other country where corruption is something which happens on an almost daily or weekly basis. The reason it is so stunning here though, Minister, is that the magnitude of it simply takes our breath away. Because the government failed to act at this critical juncture, $300 million flowed and we then had five years over which the kickbacks simply went from one level to the next—from $12 a metric tonne to $25 a metric tonne to $44.50 a metric tonne, and then they added an after-sales service fee.

Minister, if you respond to this MPI today, use the opportunity to explain in clear-cut terms every detail, not the select version, of what transpired in that critical meeting in the second half of 1999 between the AWB and your agency. Therein lies the core exchange where this entire sorry saga of $300 million going to buy guns, bombs and bullets for Saddam Hussein’s regime could have been stopped. You, Minister, failed to stop it.

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