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

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

The failure of the Government to properly account for its role in the continued abuse of United Nations Iraqi aid programs following the downfall of Saddam Hussein

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—

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

Let me stand back from this thing called the wheat for weapons scandal. At times like this in the debate we have to ask ourselves what it all means for Australia’s national interest. It is important to put it in short, sharp and stark terms. What it means is that there has been negligence in terms of this country’s national security interests; damage to this country’s export interests and our economy overall, and the wheat farming interests of our nation in particular; and that as the debate has unfolded the government, with control of the Senate, is becoming a government increasingly out of control and a government increasingly focusing on its short-term political interests and not on the long-term national interest.

Let us go to the first of these points, which deals with negligence in terms of the nation’s security and our broader national security interests. What we have presented so far in this debate, which has now raged for some months, is a series of warnings—17 in all—received by the Howard government. Each of them were dismissed in order. Their attitude to each of these warnings was, ‘There’s nothing in those warnings which would cause the government under any circumstances to believe that it should inquire more thoroughly about what the AWB was up to in Iraq.’

Today we had a major addition to those warnings in the four cables that have been released, cables which go to the very detail of the information which had been provided by the United Nations through our mission in New York—coming originally from the government of Canada—to foreign minister Downer’s office, where the matter then died. That is what happened: it just died. Nothing was done. That is the cold, hard reality coming out of everything that this minister had to say today.

I spoke also of not just negligence regarding national security but of damage to our exports. You would know, Deputy Speaker Scott, how important the grain industry is to our country’s economy. You would know the importance of the grain industry to your own electorate. You would know what would happen if the international reputation of Australia’s export monopoly, the AWB, was to be seriously damaged by the inaction of the Howard government in ensuring that the AWB was doing the right thing.

I would assume, Deputy Speaker, that a person such as you would find it of grave concern if the AWB was up to things and your government, of which you are part, was not taking proper action to ensure that it was not rorting UN sanctions against Iraq and not rorting the oil for food program under the United Nations to the long-term damage of the reputation of Australia’s hardworking wheat farmers. I would have thought, Deputy Speaker, that, coming from the part of Queensland that you do, you would have been actively concerned about that.

I have spoken about negligence regarding our national security—17 warnings were dismissed—and damage to our nation’s export interests, including our hardworking wheat farmers. But the other thing which this whole debate brings to the surface is the arrogance of the government.

Not only was the Volcker inquiry, which was established by the United Nations, not provided with all the documentation in the government’s possession on this wheat for weapons scandal but the Cole inquiry was given limited terms of reference by the Prime Minister so that it would not focus squarely on making findings on the competence and due diligence of the ministers charged with responsibility for our end of the oil for food program. For Volcker, there was minimal cooperation; for Cole, there are limited terms of reference—and certainly no capacity to make findings on the competence of and the due diligence executed by ministers.

So that leaves the parliament to do the job. Because Volcker was short-changed on information and Cole was short-changed with his terms of reference, we are left with this parliament—this institution—where our job is to hold the executive accountable. What has happened here? Since the government gained a majority in the Senate, we have seen arrogance unplugged from the Howard government. It is not possible to launch a Senate inquiry which would cause this government any form of political embarrassment. Then there were the extraordinary measures taken two weeks ago to ensure that public servants would not answer the most basic questions of fact before Senate estimates about this wheat for weapons scandal.

We are left with this chamber, the House of Representatives, where any question of the most basic factual nature concerning the responsibility of these ministers for this scandal have to be asked. Once again, what do we encounter here but arrogance unplugged, as each question we ask of a factual nature of ministers opposite is dismissed. The questions are not answered, or the answer is delayed to another day, or ministers fly to the other end of the earth in order not to be here to answer them.

That is where we come to with these most recent developments in the ‘wheat for weapons’ scandal. But with matters now before the Cole inquiry we are about to enter a whole new phase. What I would like to do today in this matter of public importance debate is to begin to describe the chapter which is about to unfold. It is a brand-new chapter. It is postwar Iraq, the period in which this ‘wheat for weapons’ scandal had another 18 months to run. Let us put all this into a bit of context. The first corrupt payments on these contracts occurred when? It occurred in November or December 1999, a month or two before Foreign Minister Downer got the cable which we have been debating in the parliament today, a cable which warned him that something was up with the AWB’s dealings with the Iraqi regime. Had he acted with due diligence at that time then this scandal would not have unfolded, $300 million would not have been paid to the Iraqi dictator and the five years of scandal which unfolded would not have occurred. On top of that, the damage to our national security and our export interests would not have been as severe. But the minister did not do his job.

In the 3½ years from the end of 1999 through until the Iraq war in March 2003, there were literally tens of contracts approved by the Department of Foreign Affairs and Trade from the AWB, with the money then being paid from the oil for food program into the AWB’s bank account, off to a bank account in Jordan and then into Saddam Hussein’s coffers so that he could buy some guns, bombs and bullets for later use against Australian troops—and we suspect he possibly also drew on those funds to pay $25,000 to the families of Palestinian suicide bombers. But that is all up until the war. The war happened in March and April 2003. The saga which is about to unfold through the matters before the Cole inquiry at present and the broader debate on these matters is what happened in the 1½ years after the war, before this $300 million rort was finally closed down.

The Prime Minister said something very significant in his interview with Kerry O’Brien on The 7.30 Report a couple of weeks ago. The Prime Minister was defending himself about why no action was taken in response to the 17 warnings the government had received, including the startling information revealed for the first time today in parliament in those cables of early 2000. What was the Prime Minister’s defence? It was a very interesting form of words he used. I am sure the Prime Minister’s office is watching—think carefully about this. What he said was: ‘When the war happened, the dam burst. The information started to flow.’ That was in March and April 2003. What information started to flow? What we know is that after the war the occupying forces—including the United States, Australia and the United Kingdom—captured all the senior Iraqi officials, including those in the agriculture ministry and those in the Iraqi Grains Board. All the people on the corrupt end of the deal were suddenly under our control.

What else did they get when, as the Prime Minister said, the dam burst? I will tell you what else they got: they got a truck load of documents. On top of that, as part of that truck load of documents, they got some really stinky ones, ones which we suspect had a few letters attached to them—the letter A, the letter W and the letter B. A bit of a problem starts to emerge at this point. Of course, by this stage you have the entire country crawling with the intelligence community, sent by the CIA under the auspices of the Iraq Survey Group to track down the much belated and still missing weapons of mass destruction. But while they were doing that through the Iraq Survey Group they were unearthing the money trail. The money trail, of course, came out of the oil for food program. They were trying to work out where all this money came from that Saddam was out there trying to buy weapons on the international market with. It came off the back of this rort which had been running since 1999.

So when the Prime Minister blurts it out on national television to defend himself from attack but in fact opens himself to a fresh new flank, he is admitting that this whole bucket load of information started coming his way. But here is his problem: this was in March, April, May and June 2003. You would think these blokes who call themselves the government—they take the pay cheque—having finally got that information, would have shut the rort down. It ran for another year and a half. Another great truck load of contracts gets approved and another series of rip-offs of the UN bank accounts occur, and all this goes on while this mob, the government—the Prime Minister and Fairy Floss, the foreign minister—are out there running the country and being the co-governors of Iraq. They control the country.

Then what happens in this period? Enter Trevor Flugge, the chap who is up before the Cole inquiry right now, John Howard’s Million Dollar Man—no longer Seven-hundred Thousand Dollar Man but Million Dollar Man. Note carefully today, honourable members, the response by the Minister for Revenue and Assistant Treasurer, from Queensland, Mr Dutton. He basically confirmed, if I heard him right, that there may have been a few tax concessions associated with that $1 million payment as well. Could it have been $1 million tax free? We do not know yet. We would like some confirmation from the government as to what exactly was the case. But Million Dollar Man is out there from this time on not as an AWB representative but as the Howard government’s representative. He has changed hats. He is there representing the interests of John Howard, Alexander Downer and Mark Vaile. He is there in the field together with Mr Long, formerly of the AWB as well.

It is in this period that we find these individuals involved in providing advice to the Coalition Provisional Authority—on what? On what should happen with the continuation of these wheat contracts with the Iraqis. Suddenly the poacher has become the gamekeeper. He has been allowed into the nest. We find that these AWB representatives—now Howard government representatives—are in Iraq, the engine room of the Coalition Provisional Authority, with all this information flowing in from the intelligence community, the captured documents and the interrogated Iraqi officials. Doesn’t this present an interesting set of circumstances? You have Mr Flugge there sitting in the Coalition Provisional Authority with 29 or 30 other Australians and suddenly all this information starts to flow in the door. What do you do with it? This is the story yet to be told.

In those critical months of March, April, May and June 2003, we have a really stinking cat thrown onto the table, and all this information starts to unfold. It comes to the surface in about June 2003 when Mr Long—formerly of the AWB and now in the Howard government’s employ—sends back a memo to Canberra saying: ‘Good, God! We’ve got a memorandum of instruction from the Coalition Provisional Authority which says that there have been kickbacks attached to these contracts with the Iraqis. What are we going to do about that?’ In that cablegram they say that a list has to be prepared of all the contracts that have been done with Iraq, putting those with a 10 per cent kickback attached to them on one side of the ledger and, on the other side of the ledger, those which do not.

In the weeks and months that this debate has raged, the government have failed to answer what they did to pursue whether or not AWB fell on the wrong side of that ledger, that list or that matrix which was being prepared. Throughout this period of time, you have Mr Flugge—with gun in hand and presumably a bucket of cash provided by the Howard government as well. I have noted carefully the Prime Minister’s belated response to my question yesterday that Mr Flugge has been out there doing a job on behalf of the Howard government. That is where the debate is about to unfold to.

This whole 18-month, postwar period points not just to incompetence or negligence but to a government doing much more than turning a blind eye. Throughout 2003-04, when the corrupt contracts are continuing to roll, the government is in control of the government of Iraq itself and the entire information flow. This is where the debate will now go. Mr Flugge is central to this story. He is Mr Howard’s personally chosen representative—his own personally selected million dollar man—the man sent there to do a job in Iraq. They certainly did a job on Iraq. Whether they did a job for Iraq remains to be seen. We intend to pursue this new chapter in the $300 million ‘wheat for weapons’ scandal, until we have the truth out of this government once and for all.

Bruce Baird (Cook, Liberal Party) Share this | Link to this | Hansard source

I rise today to participate in this MPI debate on the oil for food program, which is becoming increasingly like Days of our Lives. It is constantly going into repeats, with the same old facts rehashed and the same old figures and the same old personalities coming out. What is missing in this whole exercise is the smoking gun. The opposition smear, make allegations and try to reduce the reputation of ministers in this House over this issue. The Leader of the Opposition has boldly said that the case has been proved, but on this side of the House we are still waiting because clearly the case has not been proved at all. The opposition would like to see clear evidence which shows that the ministers knew all about these allegations and did nothing or, alternatively, that they knew all about them and decided for various reasons not to become involved.

The fact is that, despite all of the allegations by the opposition, despite all of their efforts—there has been a failed censure motion, this is the second MPI that I have participated in and they have concentrated on this issue in every question time in the House over the past four weeks—and despite all their huff and puff and bravado, not one scintilla of evidence has shown that the hands of the Minister for Foreign Affairs, the Prime Minister, the Minister for Trade or any of the people mentioned as being involved in this series of allegations are culpable in this exercise.

All members on this side of the House would agree that this was a scandal. It was highly inappropriate that it took place. Of course, with the benefit of hindsight, the opposition make these claims. But during all those question times in the House and with all the evidence that they had, the opposition did not raise one question about this matter in the House, in committee meetings of any kind or in estimates debates. So sure are they in running a continuous program on this issue—Days of our Lives—for all to see and repeating the allegations that the allegations will find traction. The fact is that those allegations have not been proven. It has not been found that the ministers or the Prime Minister were involved in this case, and that is where the opposition founder on this whole exercise.

What was the appropriate action for the government to take in this matter? Was it simply to say: ‘Let’s just appoint one of our mates. He’ll do a quick fix, declare there was nothing wrong here and it will all be over and done with. Will we refer it to the Australian Crime Commission to see whether there is a case to answer, and then we can get on with the task? Will we refer it to a parliamentary committee, have a quick review or what?’ The government appointed a full inquiry into this issue. The Cole inquiry has full and absolute powers. It has the powers of a royal commission. No other form of inquiry has this high level of skill to investigate whatever it needs to and to talk to any person about any matter at any time.

The opposition say that the government are just trying to shirk their responsibility and are trying to brush the whole thing aside, but the reverse is the case. The reverse is that you have a high-profile, high-scale inquiry, where every document requested by Mr Cole has been provided and where every witness who has been asked to appear before Mr Cole has also been provided. Just last week it was reported in the news:

Commissioner Terence Cole has invited any MP, journalist or public servant to assist inquiries into “the actual or constructive knowledge of the Commonwealth”.

In other words, that ministers and their staff, senior public servants, including those in the Prime Minister’s office, knew what was going on with respect to all these allegations. Mr Cole has invited all these people with their conspiracy theories—and the opposition is included in this—to come forward. Every piece of evidence that they can provide has been requested by Commissioner Cole: ‘Come forward; show us what you have.’ The reality is, as we all know, that they will not be able to provide that. We have talked about the cables that came to the department. There is no doubt that these cables are important. But it also has to be placed in the context of when they were sent and how they were sent. It is not like a normal diplomatic exchange on Australia’s reputation et cetera. We were in a very competitive international market situation.

Who brought these allegations forward first of all? It was the Canadian and American wheat growers who, of course, for some time had wanted to knock off the Australian wheat supplies. It is a competitive, tough international marketplace and they will use any means that they can. They hear the rumour—in they go. It is in that context that these cables came into the various offices saying that these allegations had been made. Of course people would say, ‘This is only our competitors having a stir,’ and so it is brought forward. The opposition would say this is an issue about which we could all be sure that everyone knew and accepted as fact. But the fact is it was a market situation and one of our competitors was making an allegation and nothing more than that.

Commissioner Cole has the power and the level of knowledge within every area of government to investigate all of it. Any correspondence, letters, emails and phone calls that came through to the government are there. He has the power to look into it. Of course, some of the revelations that have come forward have been disturbing. But the government is trying in a totally honest and open way by saying: ‘Let’s put it all out on the table and what falls falls. Let’s see who was involved. Let’s see which officers may have been involved in this case and did nothing. Let’s look at the actions of the AWB and which executives of that organisation were involved. Why was this not picked up before?’ Of course, we have to ask the question at the same time: why did the UN inquiry not pick it up?

Remember that it was not as though there was no inquiry and suddenly the matter came to light. The United Nations, which is the peak world body, set up a committee whose sole purpose at that time was to look at this oil for food program. They had the allegations from the Canadians; they had the allegations from the Americans. It was their task. They were trusted with the full investigation of this inquiry.

Did the Australians simply come in and say that this was total nonsense and that they would not participate in this program? Not at all. It was a full inquiry and it concluded—in retrospect, it was not an appropriate conclusion—that the allegations were unfounded. All the huff and puff from the opposition would seem to ignore the fact that it was a UN inquiry—it was not a coalition party inquiry—that said the allegations were unfounded. So you could hardly blame the ministers involved if they were told, ‘The UN inquiry found that there was no basis to these allegations,’ and they then did not turn everything upside down and ask, ‘What is the real situation?’ because the inquiry had happened and those were its findings.

As we moved on to the Volcker inquiry, set up by the UN to look at the matter in more detail, this government then cooperated to the fullest extent with Volcker. There was no hiding of documents; there were no quiet words in his ear about any of it. Everything was provided. The government took a totally open approach to the Volcker inquiry, where everything became public. The role of Alia in transporting the AWB wheat was known. Once that came to light, the Prime Minister decided on a full-blown inquiry with royal commission powers to investigate this matter.

The opposition want to make quick conclusions and make allegations. I notice the member for Wills is in the chamber, and he has been making allegations about the member for Gwydir—that he was selling his shares and so on. I have discussed this with the member for Gwydir. That allegation was absolutely totally outrageous and well you know it. There is not a more honest man in this House than John Anderson, the member for Gwydir. To go around and simply slur people’s—

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

Go and talk to Tony Windsor!

Bruce Baird (Cook, Liberal Party) Share this | Link to this | Hansard source

Tony Windsor we all know, because he has always been jealous. Because he missed out on his preselection for the seat of Tamworth, he has never got over it. So he has this whole psychological thing with the member for Gwydir because the member for Gwydir did what he could never do—that is, become the Deputy Prime Minister. He did a fantastic job, he is a man of incredible repute and what do the members opposite do? They just slur his reputation—they do not care—‘Let’s throw it around. He sold his shares; he knew all about it.’ He was sitting on the back bench then. We on this side of the House think that type of approach is to be absolutely condemned. It is typical of the way the opposition have gone. With little evidence, they simply smear the reputations of the ministers and the Prime Minister, saying, ‘They all knew all about it, and they in retrospect were so wise and would have done that.’ Of course, the reality is quite different. The matter was investigated by the UN; it was investigated by Volcker. We have set up a full inquiry and I have not heard anybody say, ‘You should have set up a different type of inquiry.’

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

Terms of reference!

Bruce Baird (Cook, Liberal Party) Share this | Link to this | Hansard source

Well, they did initially, about the terms of reference. The Prime Minister has said that anybody can be called before the inquiry. He will not stop anybody, whether they are a government minister or a senior public servant. That is why Commissioner Cole has called for anybody, if they know of evidence—

Joe Hockey (North Sydney, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

Are they putting in a submission? Are the Labor Party putting in a submission?

Bruce Baird (Cook, Liberal Party) Share this | Link to this | Hansard source

That is right. We would ask you whether you are ready to appear before the inquiry as well. There is no obstacle to prevent anybody in this land being called before that royal commission. If the member for Wills knows of anyone who is prevented from appearing then we would like to know, because the Prime Minister has made it very clear that everybody is available to go before it. Isn’t this what you would do if you had an issue? And there is the member for Windsor—

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

New England.

Bruce Baird (Cook, Liberal Party) Share this | Link to this | Hansard source

I am sure with another allegation against the member for Gwydir, having his normal jealousy of the member for Gwydir, but the reality—and I am sure he would consult with the member for Wills—

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

Another bribery scandal, Bruce; another bribery scandal!

Bruce Baird (Cook, Liberal Party) Share this | Link to this | Hansard source

I am sure you would love to have one, but it will not happen for you, regardless. What we have seen is an ill-founded attack, when the government has done all in its power to have a full, open, transparent inquiry where anybody can be called before the inquiry, where the commissioner has full royal commission powers. He can ask for any papers to be provided.

The bottom line is that, despite the claims from the Leader of the Opposition that the case is proved, the fact is that the case has not been proved. We are waiting for fair justice, for the commissioner to bring down his report, bring down his recommendations and make his findings and not to be subject to all these allegations, smears and innuendos that we get from a whole lot of members opposite, when the reality is that the government is doing absolutely the right thing. It is clear, transparent and evident to everybody. This government means to do business, and it is doing the right thing in terms of this inquiry.

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

In Australia, we love our sport. In my own home town of Melbourne, we are getting particularly excited by the Commonwealth Games just around the corner. One thing we do not tolerate is cheating in sport. We hate cheating. We hate performance-enhancing drugs. It is not the Australian thing to do. Unfortunately, we now know that our wheat-exporting monopoly, AWB, was the gold medal winner for kickbacks in Iraq. Those $300 million in inland transportation fees were the performance-enhancing drugs, the steroids, of AWB’s wheat trade in Iraq.

But government ministers, from the Prime Minister down, want us to believe that they knew nothing of what was going on. They make a virtue of their incompetence. They revel in their incompetence. But, with every passing day, this Sergeant Schultz claim that ‘we knew nothing’ becomes less and less believable. Just yesterday, the member for Gwydir, former Deputy Prime Minister Anderson, stated that the Prime Minister asked him early last year what he thought of AWB executives. The member for Gwydir says the conversation was cut short, so I guess we will never know why the Prime Minister was seeking his opinion on the calibre of AWB personnel.

But this is the same Prime Minister who told us in January:

... there were no alarm bells. There was no suggestion, there was no evidence before us that AWB was paying any bribes.

Well, Prime Minister, there were alarm bells ringing in Canada, there were alarm bells ringing in the US, there were alarm bells ringing in Iraq, there were alarm bells ringing at the UN, and there were even alarm bells ringing at farm machinery days in the Victorian Mallee. It seems that the only people who could not hear them were the Prime Minister and Trevor Flugge. How are we supposed to reconcile the Prime Minister’s claim that there were no alarm bells with the member for Gwydir’s statement that the Prime Minister raised the character of AWB personnel with him? Why did he ask, if not because alarm bells had started to ring?

And how are we to reconcile this with the Prime Minister’s statement that the AWB people were ‘a very straight up and down group of people’? He said: ‘I can’t, on my knowledge and understanding of the people involved, imagine for a moment that they would have been involved in anything improper.’ On what did he base that assessment? It seems to me that, by the time he made it, he must have realised the seriousness of the issue, so he was basically trying to put one over the Australian people in the same way that the government tried to put one over US senators Tom Daschle, Patty Murray et cetera.

This matter of public importance provides us with the opportunity to condemn the government’s continuing refusal to answer questions about its role in the ‘wheat for weapons’ scandal. I lament the way the government is treating this parliament with contempt, stonewalling questions in this House and shutting down the Senate estimates committees. I remember that when the Prime Minister won control of the Senate he said he would not abuse his newly won power. It did not take long for that promise to vanish—just another non-core promise lying dead on the road.

There are many questions which remain unanswered. For example, AWB’s public and government affairs manager, Darryl Hockey, a former adviser to the member for Gwydir, Mr Anderson—it really is hard to know where the Wheat Board stops and the National Party begins—has stated that he specifically asked Minister Downer’s office and Minister Vaile’s office to say nothing about the sale of wheat to Iraq in December 2002. Given that governments are normally falling all over themselves to announce large wheat sales as good news, you would think that that request for confidentiality would have struck the ministers, in the words of the Prime Minister, as ‘passing strange’ and rather irritating. So the question I have for these ministers is: did they make any inquiries about why they were being asked to keep quiet about the sale and, if they did make any inquiries, what were they told? What did they find out?

The government also has to tell us on what basis it agreed to pay Mr Trevor Flugge, the former National Party candidate, $978,000 from the foreign aid budget for eight months work in Iraq after the fall of Saddam Hussein’s regime. What were Mr Flugge’s qualifications to be paid so much? What did Australians get for our million dollars? Why did the money come out of the foreign aid budget? I thought the aid budget was to feed starving people, not to make millionaires out of unsuccessful National Party candidates.

After the fall of Saddam Hussein’s government, the Howard government sent Mr Flugge to Baghdad and paid him $978,000 from our aid budget for eight months work because he was such a great communicator. Yesterday he told the Cole commission he is pretty much deaf—he has a virtually ineffective left ear and a right ear which is somewhat impaired. Mr Flugge’s hardness of hearing came in relation to the subject of trucking fees being raised at a 1999 dinner where AWB executives were present. Mr Flugge wanted to take issue with AWB whistleblowers who claimed that the fees paid to that truckless Jordanian trucking company, Alia, were a means of paying kickbacks. The whistleblowers have told the Cole inquiry that Mr Flugge had approved the use of the London based trader Ronly Holdings, where his daughter worked as a junior administrator, as a middleman to pay the bribes. I believe the whistleblowers. I find it absolutely unbelievable that the government should have been paying Mr Flugge $978,000 from our aid budget for an eight-month consultancy job in Iraq.

That was yesterday; there is something new every day. Today we learn that there are cables from early 2000 from the Australian embassy to the United Nations in New York which expressly warned the government, first, that the Iraqis were demanding a surcharge of $US14 per metric tonne for wheat which would be paid outside the oil for food program; second, that the funds were to be provided into a bank account in Jordan; third, that the system was designed to provide illegal revenue for Iraq in US dollars; fourth, that the UN believed the company involved in the scheme was owned by the son of Saddam Hussein; and, fifth, that the AWB had concluded contracts of a similar nature to this with the Iraqi regime. The cables also say that another national wheat supplier had specifically rejected these approaches having been advised by the United Nations that accepting any such arrangement with Iraq would not be permissible under the oil for food program.

In the parliament today, the Minister for Foreign Affairs, Mr Downer, admitted that he had seen these cables. The media have been clamouring for a smoking gun. There is more smoke here than you would find in a London pub. The Minister for Foreign Affairs has had his attention expressly drawn to each of the elements in the oil for food scandal and yet no action has been taken and we have seen this $300 million debacle progressively unfold.

The government has been getting increasingly worried and casting around for distractions. Today we had the government’s Minister for Health and Ageing, Mr Abbott, casting around for distractions. He asked: ‘Are there any Australians in the Australian Labor Party?’ They are all Australians. Everyone who participates in Labor preselections is an Australian citizen, unlike Liberal Party rules, which have no such requirement and have led to such excesses as the Liberal preselection for the electorate of Ryan being participated in by residents of Hong Kong who had no Australian connection whatsoever.

The government has received warning after warning after warning of what was occurring. We have talked during this debate about the period after the downfall of Saddam Hussein. There were warnings in June 2003 from Michael Long and again from US Wheat Associates, who wrote to US Secretary of State Colin Powell. There were warnings in August 2003, in September 2003 and in October 2003. Then, late last year, the balloon really started to go up. We know that the Prime Minister met Paul Volcker in New York and the issue of the oil for food scandal was discussed.

We also know that the foreign affairs minister had discussions with Mr Volcker. Mr Downer’s meeting led to a flurry of activity, suggesting a realisation on his part that the cat was out of the bag marked ‘AWB kickbacks’. Minister Downer met with AWB senior personnel and told them the report was bad for the company and they needed to meet with Mr Volcker as soon as possible. A week later, the member for Gwydir sold all his AWB shares. Given this history, it is high time ministers started to appear before the Cole inquiry instead of trying to hide behind it. These ministers and former Minister Anderson should go before the Cole inquiry and answer the question which would no doubt be put to them.

Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Link to this | Hansard source

Well may we ask: why are we having this debate at all? The reason, of course, is that the Labor Party needs some form of divertissement. It is presently engaged in ripping itself to shreds. It is presently engaged in a vendetta with its figurehead and its spearhead being that campaign against Simon Crean. Why? Because Simon Crean had the audacity to say he wanted to reform the Australian Labor Party and reduce the amount of union power in picking candidates for preselection who subsequently become members of parliament. That is what this is really about. Read the newspaper headlines: ‘Queue for safe Labor seats grows’ and ‘Six Victorian MPs facing the boot’. Again and again we are seeing disarray in the Labor Party, and what better way to deal with that disarray than to show a concerted front on which they could all agree by trying to give the government a hard time on the Wheat Board.

Let us look at the reality of the situation. The terms of this matter of public importance are:

The failure of the Government to properly account for its role in the continued abuse of United Nations Iraqi aid programs following the downfall of Saddam Hussein.

Firstly, you can thank the coalition of the willing and the Howard government, which joined in that coalition, for the exit of Saddam Hussein. If it had not been for that determination, he would still be there. That would please the Labor Party, who did not support the downfall of that dictatorship. They were wishy-washy and, quite frankly, if their views had been followed he would still be there today. But the proper role of government was fulfilled on 10 November, when the Hon. Terence Cole AO QC was:

... appointed Commissioner to conduct an inquiry into and report on whether decisions, actions, conduct or payments by Australian companies mentioned in the Final Report (‘Manipulation of the Oil-for-Food Programme by the Iraqi Regime’) of the Independent Inquiry Committee into the United Nations Oil-for-Food Programme breached any Federal, State or Territory law.

That was the government’s role and that was the government’s response to the Volcker inquiry—quite proper and fulfilled. In the terms of the MPI being moved today by the honourable member for Griffith, quite simply the government has fulfilled its role of accountability by appointing a commission which has powers conferred by the Royal Commissions Act 1902.

I go back to the point of why we are seeing fulmination by the Labor Party on every occasion. I think we must be up to 90 questions asked by the Labor Party on this issue to date—90 questions that have not laid a glove on anyone. No connect has been made to the government. Not prepared to let the Cole inquiry do its work and bring out its report, the Labor Party simply want to have, as I said, a smokescreen and divertissement which takes people’s attention away from what is really going on in the Labor Party—which is a mammoth bloodletting; a vicious vendetta against Simon Crean in particular for his actions in reducing the power of the trade unions and a vendetta against everyone who voted for the disastrous Latham experiment.

I can understand why the Labor Party are angry about the fact that they were stupid enough to pick Latham. I think, if you look at the way they self-destructed during the campaign under a man who clearly could not handle it, all those people who were there to—

Nicola Roxon (Gellibrand, Australian Labor Party, Shadow Attorney-General) Share this | Link to this | Hansard source

Mr Speaker, on a point of order: the member has been speaking for more than five minutes now and has not once mentioned any word that is the topic of the matter of public importance before the House. I do ask that the member be brought to the topic. I know that it is not interpreted terribly strictly at this time, but the member should at least vaguely be able to discuss the topic that is before us. It is after all a very important matter of public interest. I would have thought that the member for Mackellar might be able to say something of significance on the topic.

Kim Wilkie (Swan, Australian Labor Party) Share this | Link to this | Hansard source

I believe there has been wide-ranging discussion and there has been some reference to the terms of reference of the MPI.

Mrs Bronwyn Bishop (Mackellar, Liberal Party) Share this | Link to this | Hansard source

It is a pity that the member opposite who raised the point of order is deaf as well as being involved in the vendetta against Simon Crean. I go further to look at the Volcker report. To put it in true perspective, when we look at the inquiry Volcker embarked upon, he was looking at 2,220 companies—food companies, a bank, the UN secretariat and UN contractors. There were 2,220 companies involved in that investigation, involving 66 member states. If you listened to the subterfuge from the Labor opposition, you would have thought that the Volcker inquiry was exclusively about Australia and Australian Wheat Board Ltd—AWBL. You would not have thought that there was another thing being investigated.

As I said when the honourable member across the way was not listening, the MPI says that the government has not fulfilled its role. I said it had fulfilled its role totally when it appointed the Cole commission to look into Australia’s role and whether or not there had been any breach of federal, state or territory law. I said on a number of occasions that it was about time that the opposition awaited the outcome of that inquiry and then perhaps we can debate what occurs after that. Of course, if we waited for that, the major story that would be running on the front page of the newspapers would be the bloodletting of the Labor Party. Anybody in politics knows that disunity is death. That is precisely what the Labor Party wishes to cover up. The issues are being dealt with quite properly by the government in fulfilling its role, the same role that in the matter of public importance the opposition says we have not fulfilled. Quite clearly, anyone who questioned the government’s response to the Volcker inquiry has properly been answered by the Cole inquiry.

We can look further at the sorts of things that the government is doing in addition to assist in Iraq to ensure that the actions of the coalition of the willing result in a successful outcome for Iraq. In that context, we have committed $173 million in aid—$55.5 million for immediate humanitarian needs; $47 million through multilateral agencies to support elections, agriculture, governance and refugees; $37 million spent on reconstruction assistance, mainly in agriculture and governance; and a further $33 million allocated for construction assistance from 2005 to 2007. In addition to that, we have involved ourselves in UNICEF projects with another $14.5 million for water and sanitation—the provision of two million litres of clean water daily. AusAid funds to UNICEF for water tanks in Basra are benefiting over 200,000 people through the provision of daily supplies of water and rehabilitation of water and sewerage facilities in 10 governorates. AusAID funding supported the rehabilitation of seven Nissan water treatment plant power stations. In the area of health, 4.2 million children under five-years-old and 700,000 pregnant women have been the beneficiaries of a vaccination program. There has been training for 140 physicians and 203 health workers on preventative health services, immunisation and health management. There has been training of 450 health workers specialising in child sickness.

In other words, not only does the government totally refute the proposition set out in the MPI by saying that we have properly fulfilled our role by appointing the Cole commission under the Royal Commission Act 1902 to inquire into these matters but also we are simply one country out of 66 with all the focus on one company when there are 2,220 involved. What we are really seeing is the Labor Party getting rid of all those people who supported the disastrous Latham experiment and masking the bloodbath by attacking sitting members in payback for decreasing the amount of union control of the Labor Party. That is what should really be debated today, not the question of whether or not Australia has acted properly with regard to the Volcker report, which the government have clearly done. (Time expired)

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

I was intrigued with the history lesson in terms of the Labor Party and what is currently going on. I think the wheat growers are very concerned about what is going on in relation to the daily exposé of the Wheat Board. I think there are only two or three wheat growers actually in the House of Representatives, of which I am one. It would be pertinent for those entering the debate to have a very close look at the history of the Australian Wheat Board and the history of the farming movement as to how and why the Wheat Board came about.

Undoubtedly, this particular issue of the corrupt activities of members of the Australian Wheat Board is going to damage our credibility in any international forum in relation to trade negotiations. I think most people would be aware that Australia has been at the forefront of trying to achieve free trade and a more balanced nature of our trade. Whether the government or the ministers that have been named in this issue have been involved or not or can be proven to be involved or not is almost irrelevant compared with the damage that is being done internationally. In the future Australia and our current Minister for Trade, Mr Vaile, will have to go into those forums and argue for free trade when this sort of activity has been going on. There have been, rightly or wrongly, a number of missives that have been sent, messages that were not properly picked up or maybe ignored—I do not know the answers to that and I do not think Commissioner Cole will actually find the answers to those things either—but the fact is there has been enormous damage done.

There have been a number of meetings across Australia with political players, some wheat growers and some organisations where the issue of the Wheat Board has been discussed. But wheat growers are very concerned. They want the truth to come out and they feel it has to come out before we can regain any credibility internationally. Wheat growers are very concerned about the future of the single desk arrangements. Wheat growers do not want the baby thrown out with the bathwater on this issue. There may be some finetuning that needs to be done to the Wheat Export Authority or a body such as that where there can be greater scrutiny of and transparency in the Wheat Board’s activities. I think that is an issue that has to be decided. Many members of the government have been saying that we do not want to mix those two issues, and I agree with Mr Vaile’s statement, but many members of the government are actually mixing the issues to a political end. Some people believe that this issue of corrupt activity by members of the Wheat Board in dealing with Iraq may well open up an opportunity to free up the single desk arrangements into the future. As I said, the wheat growers that I have spoken to do not want that to happen. They do not want the two debates to run at once.

I call upon those members of the government in particular, but all members of parliament in general, who are suggesting—and the Treasurer is one of them—that there should be alternative ways of marketing grain and that there should be a freeing up of the way in which export grain enters the marketplace on the back of the Iraqi activities to support the single desk arrangements, to allow the Cole inquiry to take its course and, on the determinations that are made by the Cole inquiry, to keep in place the single desk. That may well, as I said, require some degree of tinkering with the Wheat Export Authority or a similar body into the future. But there is enormous damage being done. I think we all recognise that.

One thing the government has not done is to recognise that there are other ways of using this grain. We tend to have a mindset that Australia is an exporter of grains. We export something like 75 to 80 per cent of our capacity; therefore, we think we are dependent on the world market. That has been one of the issues in running the free trade agenda. But there are alternatives, and I do not think this parliament, and particularly the government, pay enough attention to those alternatives. The government should be serious about looking at those alternatives, particularly given the fact that the grain market is corrupt. Every day we have someone from the government or the Wheat Board saying that that is the way the world is. I do not actually believe that, but let us assume for the moment that they know more than I do—that is the way the world is; it is a corrupt marketplace. So we have an absurd situation where we grow our grain, we export it on a corrupt market and then we use some of that money to enter another corrupt market, that of the oil business. There are the fuel companies themselves and there are the various countries in the Middle East that have the oil, and we go out into the world market, trade our grain in a sense and bring back oil. As time goes on, that will happen more and more.

The government is not looking at ways and means of cutting that corner. I know I have raised this issue before, but I will raise it again because I think it is particularly pertinent. If Australia adopted a mandatory 10 per cent ethanol in our petrol, that one stroke of policy would remove half the export grain from the marketplace—eight million tonnes. We export about 16 million tonnes a year. Ten per cent ethanol in our fuel is something that many other nations are doing. Even the President of the United States, George Bush, has recently announced that they will move towards much more sustainable energy and that they are going to get off their addiction to oil. They can see what is happening and potentially happening internationally. If we adopted a policy of 10 per cent ethanol in our fuel, that would potentially remove eight million tonnes of grain from that corrupt market. Twenty per cent of the total wheat production for export would be removed, and it would remove the necessity to enter these two corrupt markets. Those markets will get worse as time goes on.

The government has not looked at those options. The government tends to be locked into the mindset that we have to export and that, if we export, we have to take it for granted that those markets will be corrupt and that we need to get rid of the grain—we need the money, our farmers need the money—and, therefore, that is the way the world operates. It is not the way the world operates in the United States, the bastion of free trade, and it is not the way the world operates in Brazil. Brazil, for instance, is expanding its ethanol industries at the rate of one Australian sugar industry per annum. The United States is building ethanol plants at a rate of a little under one a month.

As the Minister for Community Services at the table would realise, we are looking at grain prices of about 25 years ago. The grain prices to the farmers in Australia are very low at this time. Irrespective of whether or not the government is involved, the damage has been done to our trading reputation. It is time that we looked at alternatives if we are really concerned about the wheat growers that everybody is crying about. It is time that we looked at real alternatives to the uses of grain products, rather than having this constant harping. I was one of those in the eighties—because I was involved with the Grains Council of Australia and the New South Wales Farmers Association—who was arguing for a level playing field internationally. That is fantasy land. It is fantasy land in United States, it is fantasy land in Europe and it is fantasy land in the South Americas, and it should be considered as fantasy land here. We have to start to look at alternatives to the exportable surpluses we produce. There is an enormous opportunity in the grains and sugar industries through sustainable energy and renewable fuel in biodiesels and ethanols. I would suggest that, if both sides of this parliament are, as they say, really concerned about wheat growers in Australia, they start looking at those alternatives. (Time expired)

Kim Wilkie (Swan, Australian Labor Party) Share this | Link to this | Hansard source

Order! The discussion is now concluded.