David Hawker (Speaker) Share this | Link to this | Hansard source

I have received a letter from the honourable member for Corio proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The failure of the Government to investigate the AWB over payments to the Iraqi regime.

I call upon those members who approve of the proposed discussion to rise in their places.

More than the number of members required by the standing orders having risen in their places—

Gavan O'Connor (Corio, Australian Labor Party, Shadow Minister for Agriculture and Fisheries) Share this | Link to this | Hansard source

The matter of public importance we are debating today is the biggest scandal this nation has seen in its recent political history: the payment of kickbacks worth $300 million by the Australian Wheat Board to the Iraqi dictator Saddam Hussein. These kickbacks occurred at a time when the Australian government was strutting the domestic and international stage railing against the excesses of the Saddam Hussein regime and preparing for war against it. There is one central, undeniable fact in this whole sordid saga: this scandal occurred on the Howard government’s watch. No-one else is to blame; this scandal occurred on the Howard government’s watch. The Liberal and National party government led by John Howard has presided over a scandal of gigantic monetary proportions—$300 million worth of growers’ money paid to an Iraqi dictator.

The Prime Minister is an emperor without clothes in this scandal. It is of such proportion that there is really no credible defence for this bankrupt government. The government claims that it knew nothing of the kickbacks in face of the evidence that we now have. If that is the case, then it is culpable on a grand scale. If it knew of the kickbacks and failed to act on that information, then it is culpable on an infinitely greater scale. Either way it stands condemned. It stands condemned for its failure to act to investigate the Australian Wheat Board over payments of some $300 million to the Iraqi dictator.

The charges of substance now against this government are most serious indeed. In the face of the evidence presented to the Cole inquiry thus far, on the most generous of interpretations this government is guilty of negligence and incompetence. At worst, it is guilty of a breathtaking betrayal of Australian wheat growers, the rural communities on which they depend, the Australian community and the international community of which we are a part.

As the evidence from the Cole inquiry mounts, front and square now in the docks are the Prime Minister, John Howard, the Deputy Prime Minister, Mark Vaile, the Minister for Foreign Affairs, Alexander Downer, the former Minister for Agriculture, Fisheries and Forestry, Warren Truss and the current agriculture minister, Peter McGauran. The issues at stake in the failure of the government to investigate the Australian Wheat Board over payments to the Iraq regime go to the very heart of the values that underpin the democratic processes in this great country. They go to the value of accountability. They go to the issue of transparency. They go to truth in government. And they go to the culture of cover-up and deceit in a government drunk on its own hubris, arrogant in its actions and now in complete denial of any responsibility for this scandal.

This nation’s great international reputation is being sullied by each new revelation in the Cole inquiry. Piece by piece, as the evidence mounts the Australian people are inexorably drawn to the conclusion that, from the Prime Minister down, this nation has been betrayed by a cabal of senior ministers that, pathetically, now deny any culpability for the facts and the effects of the scandal.

The effects of this scandal are enormous. They are already being felt by wheat growers around this nation. There has been direct damage to wheat growers and their families as a result of the negligence and the incompetence of this government. Australia recently lost a contract for $1 million tonnes of wheat. The price of shares in AWB, which shares are largely held by wheat growers around this nation, has declined some 30 per cent—a direct consequence of this government’s ineptitude, incompetence and negligence. The damage is being done, as we speak, to the wheat growers of this nation. It is no use the government attempting to shift the blame, as it always does in these issues, onto the opposition or onto its officials. It cannot escape its most singular responsibility in this scandal. At the heart of it is a $300 million kickback payment to an Iraqi dictator at a time when this government was spinning the line to the Australian people that this person and his regime were evil and when it was preparing to go to war.

Simon Crean (Hotham, Australian Labor Party, Shadow Minister for Regional Development) Share this | Link to this | Hansard source

Hypocrisy.

Gavan O'Connor (Corio, Australian Labor Party, Shadow Minister for Agriculture and Fisheries) Share this | Link to this | Hansard source

It is hypocrisy on a grand scale. In addition, Australia’s great trading reputation has been damaged by these disclosures. The blame for this damage must now be laid fairly and squarely at the government’s feet. What might seem an extremely complex issue can be distilled to a very simple form so as to understand why the government is culpable in this scandal and why these ministers are seeking to escape responsibility for it. In the agriculture portfolio there is a seamless line of reporting from the Australian Wheat Board and its actions through the Wheat Export Authority to the minister for agriculture and, through the minister for agriculture, to his cabinet colleagues and ultimately to the Prime Minister. For the benefit of the House and for those not intimately familiar with this procedure, I will explain it yet again.

Historically, the Australian Wheat Board has handled the single desk arrangements for the export of wheat, the pooling of returns from export and the distribution of those proceeds to growers. In 1995 the Howard government privatised AWB and created a private monopoly to carry on the single desk role. So the current structure of AWB and AWB (International) is of the Howard government’s making. It is not the opposition’s making; it is not the wheat industry’s making. The final decision on the structure was made by the Howard government.

To monitor the role and performance of AWB and to protect the interests of growers, the government created the Wheat Export Authority. The WEA has wide-ranging powers under statute to examine records, to examine contracts in detail and in totality, to certify export details and to hold discussions on these and any other matters with officers from the AWB. In fulfilling its role, it is required by law to report to the minister in a confidential report to the parliament—that is a public document—and to wheat growers, which is also a public document.

The facts in relation to this scandal are these. Since 1999 the Wheat Export Authority has been reporting to the minister on wheat matters and on the contracts that are now the substance of this inquiry. The minister may come to the dispatch box and tell this House that the WEA reported to it in 2004 but what the minister may fail to say is that over a long period of time, and indeed since the year 2000, the WEA has been investigating, and presumably reporting to the government on, matters relating to contracts—in particular, incentives that have been paid by AWB in these contracts. In October 2000 the Wheat Export Authority specifically engaged a consultant to provide expert technical advice, analysis and assistance in examining the incentive payments in that supply chain, with a direct brief to examine the incentives that AWB offers compared to other competitors. So going back to 1999 we have a forensic examination by the WEA of the contracts themselves, of the overland transport component and of the incentives that were being paid.

If the WEA did not report these matters to the government, then it has been grossly negligent in this matter. Even if it did not report them, the government and its ministers already knew from other sources that these incentive payments were of particular concern to our trading competitors in Canada and the United States. Even though the minister might mount a defence that the WEA only drew its attention to these matters in 2004, when we examine the confidential WEA reports from 1999—if we ever get to do that—I would be very surprised if they were not mentioned. We know that from the year 2000 the WEA specifically employed a consultant to advise it on the technical matters relating to these contracts. Those technical matters included the transport component, which was grossly inflated and which was the channel for the kickbacks, and the other incentives.

I detailed those warnings to the House during the censure debate. They ranged from June 1999 right up to 22 October 2003. They were not just claims made by a wheat grower or by somebody in the industry or by somebody floating around the world who had a bit of information about these kickbacks. These complaints were made by the Canadian wheat authority and they were made by the US government. Yet these ministers in government did nothing about these specific inquiries.

We are not dealing with a small rural industry here. We are dealing with Australia’s great wheat industry. This is an industry that produces some 23 million tonnes of wheat a year worth some $5 billion in exports from this country. It is an industry that employs tens of thousands of Australians. The sheer size of this industry and its importance in national and regional economic terms demand the highest standards of management from the AWB and the government and its departments and statutory authority. That ultimately is its guarantee of survival in a corrupt, competitive international marketplace.

The charges against this government are substantial. The defences that have been mounted to date can only lead any reasonable person to the conclusion that these ministers were not only ignorant but also negligent. In being negligent they have done untold damage to Australia’s wheat industry and to Australia’s wheat farmers and their families. More than that, they have sullied the great trading reputation of this country. Let it be a matter of public record now that over a long period of time, from 1999 to 2003, substantial matters were raised about kickbacks under these contracts and that ministers in this government presumably, on their own admissions, did nothing. They did nothing, as they claim, because, they say, they were ignorant of these particular matters and any wrongdoing in this scandal.

This is a scandal of momentous proportions. It is a scandal that is now damaging wheat farmers and their families across Australia, and it is doing so because of the negligence of this government. It failed to act when it should have. It failed to act responsibly in response to those matters brought before it by the Canadian wheat authority and by the American government. From 1999 to this day the minister has received reports from his own Wheat Export Authority, which examined these contracts over that period and the inland transport component. In the face of all that, the minister claims the government knew nothing. I rest my case. (Time expired)

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

There is one issue on which the member for Corio and I would be in strong agreement—that is, this is an issue of deep and abiding concern to grain growers and the industry at large. The evidence being elicited by the Cole inquiry is gravely disturbing in many respects. I would not wish to speculate nor prejudge any aspects of that inquiry, except to say that the evidence to a layman raises very substantial questions on a whole range of fronts.

So we agree on that. Where we disagree is on the allegations by the member for Corio and his party colleagues that this is the government’s scandal, that it is the government that is in the dock. A series of assertions, no matter how often repeated, claiming that the government is responsible for this situation do not prove the case, and certainly not in a technical or legal way. So the member for Corio has failed to substantiate his case, his allegations, his charges, and what we are left with is wild rhetoric and overexaggeration as well as a distortion of the facts.

The government takes the issues of the AWB’s alleged kickbacks and fraud upon the United Nations under the oil for food program with the utmost seriousness. As a result we established the Cole inquiry, which, better than anyone else could possibly have hoped to do, is getting to the bottom of the matter. The commission of inquiry was set up to investigate possible breaches of Australian law by three companies in relation to the United Nations oil for food program. The terms of reference, Justice Cole himself has advised us, are adequate in most respects, apart from one development during the inquiry relating to the so-called Tigris deal. What Justice Cole has sought from the Attorney-General will, I understand, be granted.

In the same way, any information that Justice Cole requires or requests from the Commonwealth is being provided. The Commonwealth is fully cooperating in every aspect with the Cole inquiry, including to the point where the Prime Minister has said that ministers would appear upon request. That is a measure of our support for the inquiry and its efforts to get to the truth of the matter and pursue any wrongdoing. The coalition government strongly, furiously even, supported sanctions against Iraq. If any Australian minister had a notion, let alone any evidence, that there was fraud circumventing the sanctions, he or she would not have hesitated to bring it to the attention of the Prime Minister or the government. We wanted those sanctions to take effect and would not have tolerated for a moment any Australian company circumventing them to the advantage of Saddam Hussein. The government condemns bribery of public officials and acts that were in contravention of the United Nations sanctions rules whenever or wherever they occurred. The bribery of foreign officials is an offence under the Criminal Code. If the findings of the Cole inquiry indicate that Australian laws have been breached, then it would be a matter for the Australian Federal Police and the Director of Public Prosecutions.

The problem for the member for Corio is twofold. Firstly, his new development that has gripped the attention or imagination of some in the media and on the floor of the House is not new; it is old news. The Chairman of the Wheat Export Authority gave evidence on 1 November to the Senate estimates inquiry and touched on these issues, so much so that the member for Corio—to his credit as a diligent shadow minister—issued six subsequent press releases.

Luke Hartsuyker (Cowper, National Party) Share this | Link to this | Hansard source

How many?

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

Six! They did not receive very wide circulation and some may think they are not especially interesting, but I pay full credit to him: he was onto it; he knew about the WEA investigating aspects at least of AWB dealings in Iraq. He states on six separate occasions that the WEA fully investigated these allegations. On 4 November he said:

The WEA has statutory responsibility for overseeing AWB(I)’s operations, including all aspects of the Iraqi wheat sales ... During estimates hearings this week WEA confirmed that it had been monitoring the sales of wheat to Iraq and had examined the contracts.

On 8 November he said:

The WEA has both the legislative responsibility and the power to oversee all of AWB(I)’s activities, including its involvement in the oil for food program.

On 15 November he said:

First it set up an inquiry with terms of reference designed to hang AWB out to dry but leave government agencies and Ministers in the clear, even though all contracts had been examined by at least two agencies—the Wheat Export Authority and—

DFAT. And others were along similar lines on 16 November, 17 November and 7 December, all talking about the WEA’s oversight and examination of AWB’s contracts with Iraq. It was not a state secret that the WEA had made investigations. So the smoking gun that the member for Corio promised us last night got a run—I have got to give the member for Corio credit. At this time when he needs some profile lifting it got a run. It is an old ‘un but it is a good ‘un. Sometimes a cliche particularly close to deadlines leaves a journalist with little choice, especially if they do not understand what the Wheat Export Authority is. If that is not confusing or baffling enough, there is the wheat marketing act, Australian Wheat Board Ltd, the Australian Wheat Board (International) and so on.

Nonetheless, let us strip away the political manoeuvring that the member for Corio brought to the issue and look at the substance. Where is the smoking gun? You do not need me to say there is no smoking gun. Why don’t we take the Leader of the Opposition this morning in a complete repudiation of a kind I struggle to recall previously. Has anybody got an example of a shadow minister being dumped on so quickly? One moment, it is coming to me: when the member for Werriwa, Mark Latham, was just appointed shadow Treasurer, didn’t he raise capital gains tax and his leader, the member for Hotham, dumped on him the next morning? I hope my memory is good. That is what happened here—deja vu in the Labor Party because this morning on ABC Radio by 11 am the Leader of the Opposition said this: ‘There’s no smoking gun here.’ That is not quite what the transcript of the night before says—‘There is the smoking gun,’ says the member for Corio. But I twigged there must have been tension in the camp last night. I thought something must have happened, because the news monitoring organisations got an email from the Leader of the Opposition’s office, from a Ms O’Leary, and it asked for Gavan O’Connor’s media release to be recalled.

Government Members:

Oh!

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

What is that all about? How come they say they want Gavan O’Connor’s media release entitled ‘Prime Minister wrong on AWB documents’ and dated 8 February 2006 recalled? There is a story there. My guess is—and I stand to be corrected—that the Leader of the Opposition realised that the member for Corio had employed hype, overhype and exaggerated hype of a kind that could not be substantiated. Thankfully, we do not have anything more on that level today, but still this is ‘a scandal’ of ‘momentous proportions’ of a kind ‘not seen before’ and it is ‘the first time in history’. For the wheat industry there is no underestimating the worry and uncertainty that it has caused for many grain growers who should be at the forefront in our considerations. But that is not what the member for Corio is alleging. He is alleging it is the worst or most momentous scandal for a government in history. Plainly, that is utterly wrong.

The opposition has no smoking gun. Ministers have properly discharged their responsibilities. The Wheat Export Authority were diligent in their examination of the Australian Wheat Board’s contracts with the Iraqi authorities. I am satisfied they brought a strong purpose to their task, but obviously it may well be proved to have been an unsuccessful task. But if the WEA were found to have been deceived or misled, then I venture to suggest they were not Robinson Crusoe. I have been advised that the WEA looked at all relevant information, that they spent a great deal of time and that they have looked at various records, contracts, certification of export details and authorisation letters from the United Nations and verified that the details were consistent with information and data previously obtained by the WEA. But, in any event, this is a matter for Cole. The report to the then minister for agriculture in October 2004 has been provided to Justice Cole, and anything that the Cole inquiry requests is of course provided. So it will be a matter for the Cole inquiry and we should all allow it to do its job—and we have a great deal of confidence naturally in the thoroughness and integrity of that job.

The member for Corio touched on the issue of incentives and weaved a wild tale that the fact that the WEA set out to identify what, if any, incentives existed must have alerted the minister several years ago to this cloud of corruption. To set the record straight, the WEA’s 1999-2000 annual report sets out the approach to be used by the WEA in identifying what, if any, incentives exist as a result of the wheat export arrangements and AWBI’s domestic supply chain management to deliver benefits to Australian wheat growers. As the member for Corio highlighted, a consultant was utilised to inform this assessment. Examples of the incentives intended to be assessed and quoted in the annual report include ‘Joint ventures with millers, storage organisations, export credit breaks and staff exchanges’. The WEA’s use of the word ‘incentives’ related only to the incentives or benefits of the Australian export arrangements and not to monetary payments to third parties and overseas markets. That is a terribly important point and that is where the member for Corio stretched the truth.

Luke Hartsuyker (Cowper, National Party) Share this | Link to this | Hansard source

Surely not!

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

It will be something of a surprise to some members, because the member for Corio might be guilty, at least in this debate, of exaggeration and distortion but not of deliberate misleading. The WEA assessments also included incentives contained in a service agreement between AWBI and AWBL. The results of these examinations have been reported in the WEA’s annual growers reports which are publicly available.

A short time ago I said that the member for Corio had two problems: firstly, this is old news and, secondly, he has failed to substantiate his allegations. The WEA, pursuant to their legislative responsibilities under the Wheat Marketing Act, took it upon themselves to respond to press reports, not hard evidence—as far as I am aware, no evidence of any kind was supplied to them—to examine the AWB’s books. They did so over a period of time. The question of whether or not they received the degree of cooperation that would have allowed them to make a thorough and accurate assessment is best left to the Cole inquiry to rule on if that is their wont. But we do know that within certain confines the WEA made an earnest effort. The Chairman of the WEA has advised a Senate estimates committee that there was nothing untoward. He has been publicly quoted today as saying that in reporting on the investigation to the then Minister for Agriculture, Fisheries and Forestry in October 2004 he gave it a clean bill of health.

In hindsight, we would all wish that certain factors had come to light through the course of or as a result of that inquiry. It was not to be. Again, the Cole inquiry has all the material surrounding this particular matter. Any other aspect of the WEA or any other section or area of government it requires information from will be provided and has been provided. And the terms of reference are satisfactory. It is pursuing all these issues with the thoroughness and forensic skill we would all wish it to have so that we can get to the truth of the matter and so that the grain growers and the grains industry can return to a degree of certainty and surety they are sadly lacking at present.

John Forrest (Mallee, National Party) Share this | Link to this | Hansard source

They’re trying to sell wheat.

Kelvin Thomson (Wills, Australian Labor Party, Shadow Minister for Public Accountability and Human Services) Share this | Link to this | Hansard source

I heard an interjection from the member for Mallee, ‘They’re trying to sell wheat.’ That is exactly right. It is like this: the AWB’s task is to sell wheat. They are in the business of selling wheat. They should not have been paying anything to Alia or to anyone else. They should have been receiving money; they should not have been spending money. If you are wholesaling TVs to stores for $1,000 a pop, for example, and someone at the store says, ‘I want you to pay me $200 for each TV, but it is okay, you can bump up the invoice by another $200 and make it $1,200 per TV,’ you have to understand that something is rotten in the state of Denmark—or in this case the state of Iraq. But such is the pathetically inadequate level of scrutiny that the government claims it engaged in that it was not able to work this out.

I recently came across a mock script for South Park about this very issue which had a chorus of the United Nations, Canada, US Wheat Associates and sundry brown dogs saying to the Australian government, ‘Hey, the AWB is paying kickbacks to Saddam,’ and the Australian government says to the chorus, ‘Okay, we will thoroughly investigate that.’ DFAT goes off to the AWB and says, ‘Sorry to bother you, but are you paying kickbacks to Saddam?’ The AWB says, ‘No’. DFAT: ‘Okay then. Thanks.’ DFAT goes to the chorus and says, ‘We’ve thoroughly investigated your outrageous allegations and you’re totally wrong and simply jealous of our marvellous AWB men. And your sheep are ugly too.’

We have had the Minister for Foreign Affairs saying that the AWB was a flagship company. It was a flagship of convenience concealing the government from the consequences of its own actions. This is a government which should have seen the red flags in relation to the AWB. I want to take the House to the two specific instances where the government profited politically from the cover-up of these issues and from the conduct of the AWB. In each of these incidents, the role of the government must be thoroughly explored, given their vested interest in the cover-up. First, in 2002, as the Prime Minister embraced George Bush’s decision to invade Iraq, Saddam Hussein responded by threatening to cancel Australian wheat contracts. If those sales had stopped at that time, it would have been very embarrassing for the Prime Minister and those opposite. We opposed the proposed invasion; so too did the majority of the Australian public. If Australian wheat farmers had lost this important market as a result of the Prime Minister’s actions, the pressure on the Howard government not to ignore the United Nations on this issue would have been massive.

The AWB personnel went to Iraq in 2002 to save the day. We now know how they did it. They greatly increased the size of the kickbacks they were paying to Saddam. But the Australian people and Labor opposition were kept in the dark about this. We were never told that there was a price to be paid for being able to have our cake and eat it too, to attack Saddam mercilessly in public and still be his preferred salesman in private, and a price to be paid for protecting Australian farmers from the consequences of this government’s foreign policy. That price was the payment of bribes which propped up the Saddam regime, breached the UN sanctions, have done enormous damage to our reputation as honest traders and, in all probability, will now bite our wheat farmers on the backside as other countries move to punish us for undermining the UN sanctions and rorting the system. But it was all covered up so the Prime Minister was able to go off to war without Australians understanding what invading Iraq really meant for our future trade relations with Iraq.

The second occasion on which the Howard government profited from the cover-up of this scandal was during the 2004 election campaign. In October, the Australian Ambassador to the United States, Michael Thawley, visited the United States senator Norm Coleman, of the powerful US Senate Permanent Subcommittee on Investigations and asked him to drop a committee investigation into alleged AWB kickbacks to Saddam Hussein’s regime in exchange for wheat contracts. Ambassador Thawley assured Senator Coleman that there was no truth in the allegations and that AWB had not being paying bribes to Saddam. The inquiry was dropped.

This was unquestionably politically beneficial to the Howard government. A United States investigation into AWB kickbacks to Saddam would have been highly embarrassing to the Howard government at any time and particularly during the 2004 election campaign. It is also certain that Ambassador Thawley was not off on a frolic of his own when he visited Senator Coleman. He was under instructions from someone in the Howard government. The first question is: who? The second question is: how could they justify having an Australian ambassador mislead the United States Senate? On what basis, on what evidence and on what investigations did the Australian government assure the US senator that no kickbacks had been paid? We have had the AWB saying that they were the innocent victims of the deceit of Saddam Hussein. Now we have the Minister for Foreign Affairs out there suggesting that the Department of Foreign Affairs and Trade was the innocent victim of the deceit of AWB. I dare say it will not be too long before we have the Prime Minister saying he was the innocent victim of Foreign Affairs.

The truth is that this debacle has been brought to you by the same people who brought you all the lies: ‘never, ever’ for the GST; children overboard; weapons of mass destruction—

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Wills will withdraw the word ‘lies’.

Kelvin Thomson (Wills, Australian Labor Party, Shadow Minister for Public Accountability and Human Services) Share this | Link to this | Hansard source

I withdraw. Lord Acton famously said, ‘Power corrupts, and absolute power corrupts absolutely.’ The Liberal and National parties have degenerated into parties who will say and do anything to hang on to political power. It is time for the cover-up to stop. Lord Acton also said: ‘Everything secret degenerates, even the administration of justice; nothing is safe that does not show how it can bear discussion and publicity.’ He was absolutely right. Let us have no more excuses. Let us have no more of this sleazy defence that corruption is a way of life in the Middle East—that everyone does it and it is just the way business is done.

First, it is illegal to bribe foreign officials. It is an express breach of Australian law. Secondly, the AWB kickbacks were an express breach of the UN sanctions. The whole idea of the oil for food program was to stop money from going into Saddam’s pocket. AWB did more than any other company in the world to circumvent that program. Thirdly, we expressly denied we were doing it. To anyone who asked—to the Canadians, to the UN, to US senators—we looked them in the eye and said, ‘We are not paying any kickbacks to Iraq.’ So let us show some standards.

I mentioned earlier today why I thought the position of the AWB’s CEO, Mr Lindberg, was untenable, but other heads must roll at the AWB as well. It is laughable that the directors have put their hands up for a substantial pay rise. At $4.64 a share on 6 February, AWB shares have lost 23 per cent of their value since the Cole commission commenced. Indeed, the AWB share price went up just before the Cole commission started. There were assurances given to the market by AWB management that AWB had done nothing wrong. This seems to me to be clearly a case of misleading the Stock Exchange. Is the ASX doing anything about this? Is ASIC doing anything about this?

Indeed, the problems of AWB may not finish there. Was the former Iraqi government, led by Saddam Hussein, a terrorist organisation? The Prime Minister, Minister Downer and others certainly wanted us to believe that it was. If so, did AWB breach the government’s antiterrorism legislation in paying kickbacks? Beyond this, Ministers Downer and Vaile and the Prime Minister himself have to explain how the biggest corruption scandal in Australia’s history could have been going on right under their noses without their being aware of it.

Is it incompetence of an unprecedented order, wilfully turning a blind eye, ‘don’t ask, don’t tell’ or a massive cover-up? That is why we need the terms of reference of the Cole commission widened. We need real answers to our questions. It is time for the cover-ups to stop. It is time to extend the Cole commission’s terms of reference to cover the conduct of government ministers and officials and it is time for ministers who either do not understand ethics and integrity and trade and foreign policy or are too incompetent to see that honesty prevails throughout their areas of portfolio responsibility to make way for ministers who can.

Andrew Southcott (Boothby, Liberal Party) Share this | Link to this | Hansard source

There is a tendency to see the activities of AWB in isolation. They were revealed as part of the Volcker inquiry. The inquiry was chaired by the former Chairman of the Federal Reserve, Paul Volcker. It sat from April 2004 to October 2005. When he reported he found—and the findings were shocking—that more than 2,000 companies had been involved in illicit payments. He found that 2,220 companies involved worldwide had paid kickbacks to Iraq in the form of inland transportation fees, after sales service fees or both. When the Volcker inquiry looked at the major food companies involved, to give you an idea of some of the other food companies that were involved, the five largest ones were the AWB, the Chayaporn Rice Co. Ltd. of Thailand; the Holding Co. for Food Industries of Egypt; the Vietnam Northern Food Corporation; and the Vietnam Dairy Products Joint Stock Co.

The Volcker inquiry made findings in relation to the escrow bank, the Banque Nationale de Paris. It made findings that there had been a lack of oversight from the United Nations secretariat, from member states of the United Nations Security Council and from United Nations contractors as well. He found that companies, other individuals and entities which paid the illicit kickbacks came from some 66 member states. So, while the Volcker inquiry did show a complete lack of oversight from a whole range of institutions, the Australian government has made the proper response by establishing the Cole inquiry.

The Cole inquiry is being presided over by Terrence Cole QC, an eminent lawyer—Justice Cole—and the inquiry is established under the Royal Commissions Act. The inquiry is able to determine whether any of the companies that were mentioned in the final Volcker report breached any federal, state or territory law. In the debate today we have heard all sorts of over-the-top claims. I lost count at over a dozen different claims of malfeasance and so on. The Cole inquiry is well placed to examine and determine what actually happened. Justice Cole has already asked for an extension of the terms of reference. He has said that he is quite prepared to ask for any further terms of reference if they are required. He is able to make findings of fact in terms of what DFAT knew. Ministers have said that they are prepared to go in front of the Cole inquiry. It is important that we do not prejudge the findings of the Cole inquiry. They will be available in late March. That is less than two months time.

Part of the problem here is that there is no real coherent Labor Party policy on Iraq. I have seen the Labor Party go through various contortions on Iraq. The oil for food program ran from 1996 to 2003 and the period in which kickbacks were paid ran from 1999 to 2003. What ended these kickbacks was the removal of Saddam Hussein from power. When people look back on this period in the future they will remember that in March 2003 Saddam Hussein was removed from power. They will remember that later in 2003 he was actually captured by coalition forces in Iraq. During this period it was the Australian Labor Party that was opposed to removing Saddam Hussein from power. The Labor Party has previously championed the old ‘troops home by Christmas’, but that did not work so well. It has had various contortions. The member for Griffith—I have to hand it to him—can talk and talk and talk, but it is really hard to find any sort of coherent thread in the Labor Party’s policy on Iraq.

The specific claims that have been made in relation to the Wheat Export Authority are not new. They relate to the Chairman of the Wheat Export Authority, Mr Tim Besley, who appeared before a Senate estimates committee on 1 November 2005. At that time he said that they had done a check of the details of the contracts for the sale of wheat to Iraq and nothing untoward had emerged from that check. Yesterday he wrote to the Chair of the Senate Rural and Regional Affairs and Transport Committee to clarify part of that testimony. But the important thing here again is that all of the papers and all of the correspondence relating to the Wheat Export Authority have been provided to the Cole commission. Again, the Cole commission is well placed to make any findings. This is old news and the papers have gone to Cole.

There have been a lot of claims made in the last couple of weeks by the Leader of the Opposition, by the member for Griffith and, more recently, by the member for Corio about the AWB, about oil for food and about matters which have been correctly investigated by the Cole inquiry. But there has been nothing in the way of evidence to support these over-the-top claims. There now seems to be a second charge, which is to say: ‘You should have looked at this. You should’ve investigated this further.’

Having been in parliament now for almost 10 years I have seen that, when looking for an explanation as to why it has not been able to win elections during this period, the Labor Party’s preference has always been to go for the cover-up over more substantial deficiencies. We have heard a few of them. There is the old favourite: ‘children overboard’. That is why it lost the 2001 election. ‘Never, ever’—that is probably why it lost the 1998 election. We heard in the previous speech that this matter should have been revealed during the 2004 election. What this really demonstrates is that there is a serious disconnect between the issues that the Labor Party is interested in and the sorts of issues that mums and dads out in the electorate are actually interested in. The Labor Party seems to be this generation who were brought up on Watergate: the only way to bring down a government is that there must have been a cover-up; there is no other possible explanation. It loves a cover-up. I think the member for Hotham is one of the finest exponents of the ‘Who said what when and when did they say it, and you said this on this date but what about this?’ and so on. In the end, I find in my own electorate that I do not get a lot of mail on an issue like this.

We have, appropriately, established the Cole inquiry. We should not prejudge the Cole inquiry. The Cole inquiry is more than capable of getting to the bottom of what the AWB knew and what the Department of Foreign Affairs and Trade knew. As I said, ministers have said that they are happy to appear before the Cole inquiry. That should be adequate.

This government has managed the economy well. It has managed national security well. The Labor Party, on Iraq, has not covered itself with glory at all. The Labor Party opposed removing Saddam Hussein from power. The thing that stopped these kickbacks and breaches of the oil for food program was the removal of Saddam Hussein. That was something that this government supported; it was something that the Australian Labor Party opposed. (Time expired)

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The discussion is now concluded.