Stephen Parry (President) Share this | Link to this | Hansard source

I inform the Senate that at 8.30 am this morning Senators Gallagher and Siewert each submitted a letter in accordance with standing order 75 proposing a matter of public importance. The question of which proposal would be submitted to the Senate was determined by lot. As a result, I inform the Senate that the following letter has been received from Senator Gallagher:

Pursuant to standing order 75, I propose that the following matter of public importance be submitted to the Senate for discussion:

The Government's willingness to enter into an arrangement to forgo $300 million in tax revenue in order to benefit their political allies.

Is the proposal supported?

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

I understand that informal arrangements have been allocated to allow specific times for each of the speakers in today's debate, and, with the concurrence of the Senate, I shall ask the clerks to set the clock accordingly.

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

It gives me, unfortunately, not great pleasure to speak on this, but it has to be said. We cannot be silent. We have to let everyone in Australia know what the heck has been going on. There is something absolutely rotten going on between the Western Australian state government and this Commonwealth government, both from the Liberal family of politics. We heard very, very clearly in question time today the answer when Minister Brandis was asked very clearly about some comments made by the WA Treasurer, Mr Nahan, where he had said words to the effect of, 'We have a deal'—'we' being the state Liberal government—'with the feds to bring the Bell Group resources drama, the 'fair Bell plan', to a head, but we'll circumvent the opportunity for the ATO to collect the money.' These are the words that Mr Nahan said to none other than the Western Australian parliament. He said:

We had a deal with the commonwealth that it would not oppose the Bell act.

As a Western Australian, I think we need every single cent we can get because we, Western Australians, have been ripped off—I say that without any fear of retribution—by the government of GST take. But what makes it even worse than that is the total incompetence of the Barnett Liberal government that oversaw the greatest boom in Australia's history—the mining boom. It was only five years ago that we were standing here—every Western Australian in this place—bragging about Western Australia being the engine room of the economy.

I just want to say that two of the best reporters, I believe, in this nation are based here in this building, and they are Andrew Probyn and Shane Wright, who write for The West Australian. They have written some very, very telling articles about the nonsense going on between someone over here in the Commonwealth government and someone in the Western Australian government. We heard Senator Brandis's explanation yesterday—and I will put it in my words, not his—that, 'It's all former Treasurer Mr Joe Hockey's fault. He is the one who did the deal.' The reason those opposite say that is because back in April last year Mr Hockey wrote to his counterpart, Dr Nahan, in WA, with a nod and a wink or whatever the wording was, saying, 'It'll be all right; we won't oppose it.' I can understand why Dr Nahan is absolutely fuming, because he is the one that has to take all the pain on the jobless figures. He is the one who has to come out, do the budgets and try to defend the incompetence of the Barnett Liberal government.

I just want to share some figures that would explain Dr Nahan's anger after being, in my words, dudded by someone in the federal parliament. I would not for the life of me say it was Senator Cormann. I would not say that, even though Senator Cormann is the Geppetto of the WA Liberal Party. He is the puppetmaster, make no mistake. They might use the term 'powerbroker'. It is him and one of his mates over there, Minister Peter Collier. It is well known that, if you want to be a WA Liberal member of parliament, you go to the powerbroker.

This is why Dr Nahan and co over there are absolutely ropable, I would assume, after being dudded. It could be Mr Porter—I do not know who it is; I would not have a clue—in the other place. He has had some dealings. In fact, Mr Porter is now a senior minister in the Turnbull-Liberal government. Mr Porter was also Treasurer in the Western Australian government, so he knows all about the Bell Group deal, the Bell Group plan and the Bell Group problems. That had been going on for 20-odd years. Make no mistake: my colleagues on the other side, I am convinced—in fact, I will lay a bet. Are you allowed to lay a bet here? I will lay one with you, Mr Acting Deputy President—

Alex Gallacher (SA, Australian Labor Party) Share this | Link to this | Hansard source

London to a brick.

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

Yes, London to a brick, so no money changes hands—that I am sure Western Australian Liberals will get up and go absolutely berko, scream at the top of their voices about Brian Burke and WA Inc. Do you know what? It was a pretty sad time in WA that it ended up that way. A lot of the people are no longer with us; they have passed away. Anyway, I am sure the intentions were right, but it did not end well. The courts have dealt with it. People went to jail. We needed to fix the mess.

We need to find out the truth here. Who is lying? That is a pretty strong word to use. I am not accusing anyone of being a liar, but who is not telling the truth? Is it the WA Treasurer, Dr Nahan, or is it the federal parliamentary Liberal Party over here? They cannot both be right. One is saying they got a deal; one is saying they did not. There are some very senior ministers in this government who are Western Australian based, and we all know that the Premier, Colin Barnett, but through Dr Nahan, the Treasurer, has been very critical of the pathetic efforts—or nonefforts—of Western Australian senior Liberal cabinet ministers: none other than Senator Cormann, none other than Senator Cash, none other than Mr Porter and none other than Ms Bishop, the member for Curtin. It is very disappointing, because they are selling out WA; they are not standing up for it.

Let us talk about some figures that would give anyone heartburn. Yesterday's The West Australian, that fantastic journal on the other side of the rabbit-proof fence, made it very clear in an article titled 'WA jobless level "in line with recession"'. The Western Australian Liberal government of Mr Colin Barnett had their heads in the clouds while we were going through one of the greatest booms in history. They did not make any plans about what the heck we were going to do when it stopped. Where were all these jobs going to be? I will tell you what—they are not in WA. Shane Wright is a fantastic economics editor for The West Australian, because he is always on the money; he is a visionary. He came out and told it very clearly:

Commonwealth Bank economist Gareth Aird said recession was a fair description of the WA jobs market—

the 'R' word, goodness me—

which has shed 64,000 full-time jobs over the past 22 months.

What would I do if I were Dr Nahan, the Treasurer, and I had been made a promise from someone in the federal arena? That is, apart from Mr Hockey—we know where he is; he is Australia's Ambassador to Washington. I think the more we stuff up, the bigger job we get at the end when we leave—and I am not going to pull that one, because it is true. I will give you some other figures where, if I were Dr Nahan, I would be absolutely panicking. WA has lost its AAA credit rating. In 2013 the boom had just finished. This is how incompetent the state government of WA is. An article on the ABC website states that this year alone the Barnett government:

… unveiled the state's largest ever forecast budget deficit of almost $4 billion.

The article continues:

Treasurer Mike Nahan has handed down his third budget, showing the deficit will surge from a forecast $2.96 billion to $3.9 billion in 2016–17.

Not 'creep' but 'surge'. It was the engine room of the economy a couple of years ago. The article goes on to say:

… state debt will continue to climb, reaching $33 billion next year and growing to $40.19 billion in 2020.

The previous Carpenter government left a pot of money. That mob—their cousins in the West over there—have blown it, and for years Western Australia had the greatest growth and economic opportunities known in this nation. Where the heck has that money gone? I am not even Dr Nahan; I am not the one that has been ratted on, but I am cranky. The article continues:

The Treasurer revised down the budget deficit forecast this year from $3.1 billion to $2 billion, due in part to a $500 million Commonwealth payment for the National Disability Insurance Scheme.

Good. Dr Nahan:

… revealed the deficit would jump by $2 billion in 2016–17.

In The West Australian yesterday was an article written by two of the best reporters in this building—Mr Shane Wright and Mr Andrew Probyn. The article, on page 14, is headed 'Cormann backs "fair" Bell plan'. Minister Cormann is quoted as saying that they are backing it. We just had a vote in this chamber where they did not back it. They do not want an inquiry. They do not want to know what is going on with the 'fair Bell plan'. There is nothing to see here; move along. Senator Cormann was not in here. He is probably busy now. I thought that if he had been in here he would have backed us, because in The West Australian he is quoted as saying:

We want to ensure—the West Australian Government wanted to ensure, and certainly the Australian Government was aware through the treasurer Joe Hockey, that there was an attempt to bring this issue to a close in a way that was fair to all creditors …

What the heck does that mean? He is in here arguing against it. You heard it yourself, Mr Acting Deputy President Whish-Wilson. You have seen him in here denying any knowledge of it. As I said when I started—and I will finish with this—someone is not telling the truth. Have the guts, stand up and dob yourself in.

Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

Senator Gallagher is almost right when she talks about the government's willingness to enter into an arrangement to forgo millions of dollars in tax revenue in order to benefit political mates—but you are out by 29 years, Senator Gallagher, as I will explain in a few moments.

The genesis of the background of this scenario goes back to 1987 and beyond, to the then stock market crash during the time of Mr Brian Burke as the Premier of Western Australia. It was a time when Burke and his mates—Bond, Connell, Holmes a Court and others—ran Western Australia like their own personal fiefdom. We then go to 1988, when Mr Robert Holmes a Court owned the Bell Group. Do you know what the Bell Group was? It was largely involved in heavy transport—a big cash cow. Holmes a Court owns the Bell Group, but of course as a result of the 1987 stock market crash he has gone bad. To whom does he turn? He turns to his mate Burke, now managing probably the most rotten government ever—a Labor government—since this state was developed. I know Senator Sterle will not agree with me.

What happened? The deal was done. On behalf of the Western Australian community and Bond, the Bond Group bought the assets of the Bell Group. Then, of course, as we know, by 1991 she goes to the wall, and of course it goes into liquidation. Who then was asked to pick up the cost of this whole exercise? None other than the Western Australian community, through a levy on third-party vehicle insurance. Senator Sterle assured me earlier that this was history; it had all finished. It has not finished. It is ongoing to this very day.

Let me explain to Senator Gallagher why it is that she is quite right—that there was a willingness on the part of a government to enter into an arrangement to forego millions of dollars in tax revenue. By 1992-93, the Premier of the state was Ms Carmen Lawrence. Her brother, Bevan Lawrence, made the point publicly that his estimate at that time, in 1990, was that the efforts of the Burke government—the corruption and the rot that was the Burke Labor government—had cost the taxpayers of Western Australia some $600 million. In today's dollars that is $1.2 billion. That was the brother of the Premier of the state who said we had to have a royal commission into the rot that was the Western Australian Burke—followed by Dowding, followed by Lawrence—Labor government. Senator Gallagher could not have known how right she was, because in 1987, in evidence to the royal commission that became known as the WA Inc. royal commission, forced upon Premier Lawrence partially by her own brother but also by academics and even, by then, journalists in Western Australia—

Dean Smith (WA, Liberal Party) Share this | Link to this | Hansard source

Western Australians marching in the streets.

Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

Absolutely! Senator Smith is right: people by then were marching in the street. The corruption was there for all to see. Mr Connell alleged, under oath, in evidence to the royal commission, that Hawke—being then Labor Prime Minister Hawke—dropped a proposed gold tax after Connell and various Perth high-flyers each donated $250,000 to Labor during an infamous lunch in Brian Burke's office. Senator Gallagher is right: there was an attempt by Labor mates to avoid tax. It was to do with lifting, or not imposing, a tax on gold. There is no question at all here, Mr Acting Deputy President—and, through you, to the gallery—that in the issue that has come before us today Senator Gallagher would have been far wiser to learn the lessons of history to make sure that she did not make a fool of herself.

So here was Connell, in evidence, damning himself and others for the fact that they all got their chequebooks out and gave a quarter of a million dollars to the Labor Party so that then Prime Minister Hawke would not charge a proposed gold tax, which of course would have been revenue for the people of Australia. That was the saddest part of the whole sad litany of Western Australia during that era.

I was asked this morning, because of my interjections at question time, why I had such a keen interest in it. Well, I was in business in Western Australia at that time, and I thought I was the frontrunner for an engineering project for which I had introduced the technology into Western Australia. It was original and it was unique. I engaged the services of experts from the eastern states. I influenced the then minister simply by saying to him, 'Please consider this new, unused, untested technology.' Of course, he then went and got his own consultant engineers in his department to go and check and, indeed, the technology that I had suggested was to become the technology that was used on that project. We went to tender, Mr Acting Deputy President, but I will tell you what I was told behind the scenes. I was told that if I did not use a certain firm of engineers, a certain firm of consultants, a certain firm of electricians, and plumbers, and carpenters, and transport organisations—and, by the way, if there was not going to be a brown paper bag with money in it—I was unlikely to win that tender, despite having been the person who introduced that technology into Western Australia.

We went ahead with our tender and—do you know what?—I was not going to be party to that; I was not going to be party to the corruption and the rot that had become the state Labor government in Western Australia. History records that my company did not win that tender. Another party, which presumably was willing to go down the path of these others, won it. Of course, the wrong technology was put into place and it subsequently failed. So when I speak with some passion about my memory and my recollection, it is not just the $50 per vehicle per annum that we have all had to pay for donkey's years to repay the debt incurred in those circumstances; it is my own personal memory of those times.

The question now becomes: who funded the litigation? The litigation by the liquidator was against the Commonwealth Bank, against Westpac, against NAB—against a consortium of some 20 banks. But who funded that litigation? Did the Commonwealth government fund the litigation? No. The Commonwealth government did not put in a penny. Did other creditors put any money in? No. It fell to the Western Australian community. That court case started in the 1990s. It eventually was dealt with by Justice Owen, over 404 sitting days in 2002-03, and history records that, indeed, he found in favour of the liquidator and the Western Australian insurance commission. That litigation, at the expense solely of Western Australian taxpayers, went on and on.

That brings us to the point raised by Senator Gallagher today, which is the possible involvement of the now Western Australian Liberal-led government and the coalition government here in Canberra. Those of us who know anything about litigation know that in most cases it is a lawyer-led recovery. They will keep going until there is no money left. And that is the situation that was facing the Western Australian government in 2015. If anybody has been listening to this debate, they would have thought that somehow there was a backyard deal being done—

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

There was.

Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

Listen!—between Attorney-General Brandis and Western Australian ministers for some gain. Well, let me go to the correspondence, which all of us have. I go to the letter of 15 April 2015 in which Treasurer Nahan wrote to federal Treasurer Hockey, speaking about proposed legislation to be brought to the Western Australian parliament to try to bring this event to a conclusion. Those in the gallery would be amazed to learn that the legislation had the full support of the Labor opposition in Western Australia and the Greens. You would think this is some Liberal stitch-up.

I will quote a couple of words from Nahan, who said that litigation between the creditors about distribution was 'in full flight' in both Australia and England and was likely to run for another five to 10 years, out to 2026. And now we have the circumstance in which Nahan says to Hockey that the Western Australian government is planning to introduce legislation that will—and here is dot point 1:

deliver a more rapid financial return to the Commonwealth, the State Government and other creditors;

Who is first in that list? The Commonwealth. What is this nonsense about trying to stitch up a deal to avoid $300 million of tax revenue to the Australian taxpayer after the Labor government in 1987 accepted money from their mates to avoid tax? The second purpose is to eliminate further speculation by professional litigation funders—the very ones who were going to extend this and extend it and extend it, until there was nothing left. And thirdly:

ensure no 'misdistribution' due to group complexity or leverage through litigation or a scheme;

And:

only apply to Bell companies that are registered in WA;

Where is the problem with that? Nahan says to the federal Treasurer, 'We want to bring this to a conclusion with the support of our Labor and Greens colleagues and the first creditor to be dealt with is the federal government.' And Hockey writes back to him and says, amongst other things, 'I trust the Western Australian government will therefore continue to engage in good faith in the forthcoming mediation process'.

In the few seconds I have left to me, I will say that the advice I have learnt over time is that I never try to pick a Queen's Counsel lawyer, because they are good. And what I have seen evidenced in the last few days in this place is that Senator Brandis is good all right; he is a jolly sight better than anyone who has tried to come up against him. There is nothing to see here, except— (Time expired)

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

Well, what an unstructured, irrelevant rant we have just heard from Senator Back. I am just going to calmly explain why nothing Senator Back just said is relevant to the crucial question before this chamber and the crucial question Attorney-General Brandis has consistently failed to answer over two days now in this chamber and two days preceding that in the public conversation in Australia.

What the Bell act did or did not do is irrelevant here. We all know what the Bell Act did. What the Attorney-General said or did not say on behalf of the ATO is irrelevant here. What the Attorney did or did not do in terms of the Commonwealth joining the High Court case in regard to the Bell act is irrelevant here. There are two relevant matters. Firstly, was a deal cooked up between the Commonwealth Liberal government and the Western Australian Liberal government that the Commonwealth would either not challenge the legislation in the High Court—the Bell act—or not join a challenge to the Bell act in the High Court or not run a particular argument against the Bell act in the High Court? That is the first question, and we know the answer to the question, because Dr Nahan confessed it in the Western Australian parliament when he said very clearly that there was an agreement between the Western Australian government and the Commonwealth government for the Commonwealth not to oppose the Bell act.

So, we know the deal was cooked up, because the Liberals in Western Australia have confessed on the record in the Western Australian parliament that a deal was cooked up. So for Senator Brandis to come in here yesterday and say that from his viewpoint there was no deal—it does not stack up. Just to be clear, the Greens do not make an allegation that Senator Brandis was involved in cooking up the deal. That, I have no doubt, was done by former Treasurer Joe Hockey and the Western Australian government. Where Senator Brandis comes in is that he was tapped to give effect to the deal. He was asked, almost certainly, by former Treasurer Hockey to instruct then Solicitor-General Gleeson to not run a particular line of argument in the High Court case relating to the Bell act. That particular line of argument of course was section 109 in the Constitution, ultimately the one that Mr Gleeson did run in the High Court and the one the High Court agreed with to the extent that it voted seven to zero to strike down the Bell act. It was an open and shut case. The Bell act was clearly unconstitutional. Anyone with a modicum of legal knowledge could have seen that. And that is why the deal was stitched up.

Senator Brandis has consistently refused to answer that question. That is the substantive most serious allegation before him. I have asked him on multiple occasions in this place. Senator Watt has asked him on multiple occasions in this place. And he has refused to answer. Either he has talked about something else entirely, as he is wont to do consistently, or he has drawn the veil of legal privilege down and said, 'I'm not going to answer that, because it's legally privileged.' Well, this Attorney-General is the most selective user of legal privilege I have seen in my political career, and that is saying something, because I have dealt with people like Paul Lennon in the Tasmanian parliament, who used to use it all the time, as does the current Liberal government in Tasmania. Senator Brandis is quite happy to waive legal privilege when it suits him politically, but of course when it suits him politically to claim legal privilege, that is exactly what he does.

So, this Senate voted quite comfortably today to send this matter to an inquiry. It is worth pointing out that the motion actually compels the attendance of Senator Brandis and also Senator Cormann, who, of course, was the cigar-smoking mate of Joe Hockey and finance minister at the time that this sordid affair went down. I look forward to this Legal and Constitutional Affairs References Committee inquiry. I believe that we will have the opportunity to, once again, ask these questions. We will find out whether the Attorney-General believes in the rule of law in this country and whether he is a fit and proper person to hold that office. (Time expired)

Alex Gallacher (SA, Australian Labor Party) Share this | Link to this | Hansard source

I rise to make a contribution this debate. It seems not so long ago that the Attorney-General made a very comprehensive statement in this place, and it was obviously as a result of some very careful consideration over the weekend. When this story came out, I think, on Friday—it certainly came to my attention on Friday—I thought, 'Well, I'm not a lawyer.' That is pretty obvious to most people in this place. I mean, I barely finished high school. But through my working life I did go through a couple of instances where I had to deal with liquidation and the like. In all of those cases it was exceedingly clear that the tax office was the first secured line of credit, then the secured creditors and then the employees. It seemed, to me, like an immovable, immutable law that when someone owed some money the first people who would get paid would be the Commonwealth of Australia, which is all of us. The taxation department would take the first bite of any assets that were left.

Senator Back has given us a great history lesson about some of the shortcomings in Western Australia some 25 years ago, but I do agree with Senator McKim that I am not sure that that is all that relevant to this debate here today. What is relevant to the debate here today is, firstly, how the Attorney-General keeps getting in this position. How does he keep getting front and centre in all manner of arguments? I listed all the attorneys-general since 1972, and there have been some colourful attorneys-general in those 44 years. None of them had the capacity that this Attorney-General has to get right in the middle and be obvious to everybody that he is furiously trying to avoid what has basically hit him in the face. He cannot avoid the fact that his very complex and complete statement avoids the obvious. Why didn't he, as the Attorney-General—the representative of all the people in Australia—step up and say, 'That's rubbish'? It is simple rubbish. You cannot put in legislation which would move the secured creditor, the ATO—the Commonwealth of Australia—down the list.

I think there have been some moves between Western Australia and the federal parliament. Remember they said the grown-ups were in charge—Joe Hockey and the grown-ups were in charge. Senator Cormann was right there with them with a big cigar and a big glass of wine at the 2014 budget. They played the tune 'The Best Day of Our Lives'. In all that bonhomie and goodwill that they had, did they cook up a deal? Did they cook up a deal to fix what had been a pressing domestic issue for the Western Australian federal members of parliament where their own side was saying that they were weak and that they were not advocating for Western Australia in the federal parliament and they were not doing enough to regain funds which Western Australia claimed it had lost under the horizontal fiscal equalisation and in other areas? They were getting internal criticism. Did they actually go across the border and do a deal?

We know that the Hon. Christian Porter, former WA Treasurer and former WA Attorney-General, would have been well placed to argue the case. Senator Brandis basically came out and said that it was all to do with Joe Hockey and that he was not party to a number of things. According to Brandis, the whole Bell litigation mess was the fault of Joe Hockey; the Western Australia Treasurer, Mike Nahan; the Western Australian Attorney-General, Michael Mischin; the Hon. Christian Porter; and the Hon. Kelly O'Dwyer. Remarkably, the Hon. George Brandis somehow escaped any blame at all—he was just the poor innocent Attorney-General who it all happened around. Apparently it all happened around him and nothing went through his office. Senator Dodson talked about Chinese walls. Apparently the Attorney-General's staff did not talk to him for two months and, if it was happening, he was not made aware of it.

These things are simply not good enough. The question that Senator Brandis needs to answer is: if he had no objections to the ATO office intervening in the case, why was their submission not made until the last possible day? If Senator Brandis says advising the ATO not to intervene in the case was an option he was considering, how long did he hold that view? What advice did Solicitor General Justin Gleeson give to Senator Brandis on the ATO intervening? Did Senator Brandis contest this advice? Why didn't Senator Brandis seek to correct the view of Western Australian ministers that they had a deal? I am not a lawyer—far from it. I am not the Attorney-General—far from it. I am not a QC—far from it. But I could have told them their deal would not last two minutes, because whenever there is liquidation the Australian Commonwealth through the ATO has the first chop at any liquidated proceeds. Attempting to pass some legislation in the state simply would not succeed unless there was a deal to say nothing, do nothing and hope that the Solicitor-General was a compliant person who would let this all go through to the keeper and no-one would know. But, as is always the case, as soon the deal was struck, other creditors immediately appealed to the High Court. So then the Attorney-General was in the box. He was the one who had to either stay shtum and hope the deal passed some way or other or just leave it to the court to rule it out and say, 'It's rubbish. It should never have been promulgated.'

When you think about it why is Western Australia so important? I do not count numbers in the Liberal Party. I have no idea of those. But I have heard people who are not members of the Labor Party say this. Whoever leads the Liberal Party cannot do so without the support of New South Wales and Western Australia.

Was there a deal? Was there a deal cooked up between two groups of people about achieving an outcome, where the Western Australian contingent were under increasing pressure from their own side? I think that Senator Smith did get up and advocate for a better deal for Western Australia. Not everybody in cabinet could do that though. But did Senator Cormann say, 'Don't you worry about that; I pull the strings in Western Australia. I will fix this'?

And maybe Senator Brandis is right: maybe there were Chinese Walls built around his office and his particular activities in this. He certainly has been very careful to try to demonstrate that he knew nothing about this dodgy deal, which basically looks like a politically expedient arrangement which probably carried through two prime ministers. It was probably done in the Abbott years and passed through to Mr Turnbull. And the one common denominator is Senator Cormann.

Senator Cormann has this amazing capacity to be part of every disaster—the 2014 budget; the cigar and the glass of wine; and the tune played—'Best Day of My Life'. He gets through that and still remains intact. Where is the Hon. Joe Hockey? He has been put out to pasture—very good pasture, in Washington. But that is where he is now; his career is finished. But Senator Cormann is still there, and he has this capacity to move through all of these disasters unscathed.

You can look at some of the things that come out of the Department of Finance which are not really contested in a lot of areas. We had his secretary, Jane Halton, come to the Public Works Committee and apologise because they omitted costings in a huge proposal. It does not stick on Senator Cormann. He is Mr Teflon over there, and you have to wonder why that is. Is it because he wields such incredible factional power?

The Liberal Party and the coalition are always on about factions in the Labor Party, and how there are factions about this and factions about that. Well, they are alive and well in Western Australia. They appear to have been on their way to doing a very good deal for Western Australia, to the detriment of the Australian Commonwealth and with the blind acquiescence of the Attorney-General—or he was too dumb to know what was going on. But the central player in it all, Senator Cormann, is not getting the opprobrium that he should get in this. I believe that he was misusing his position to the advantage of Western Australia.

You could argue that he is a senator for Western Australia and that he can do whatever he likes. But he should realise that the Commonwealth is the first creditor in liquidation, and that the ATO and the Australian people are entitled to get the first bite of any proceeds. To do anything other than that is pure stupidity and a misuse of his factional power.

Ian Macdonald (Queensland, Liberal Party) Share this | Link to this | Hansard source

This Bell issue all arose from those horrid days, decades ago now, but summarised by the term 'WA Inc.' Let me tell you what Wikipedia says about WA Inc.; I use Wikipedia because it has a fairly succinct description:

WA Inc was a political scandal in Western Australia. In the 1980s, the state government, which was led for much of the period by premier Brian Burke, engaged in business dealings with several prominent businessmen, including Alan Bond, Laurie Connell, Dallas Dempster, John Roberts, and Warren Anderson. These dealings resulted in a loss of public money, estimated at a minimum of $600 million and the insolvency of several large corporations.

Bond and Connell were major contributors to the party in government, the Australian Labor Party and its remarkable fundraising structure, the John Curtin Foundation.

During a royal commission set up to look into this scandal, Connell alleged that Hawke, the then Labor Prime Minister:

… dropped a proposed gold tax after Connell and various Perth high-flyers donated $250,000 each to Labor during an infamous lunch in Brian Burke's office in 1987 …

I could go on, but suffice it to say that Wikipedia also sets out very concisely that the Western Australian, Labor-led government:

… lent large sums of money, offered financial guarantees and acquired assets at inflated prices. Because of the connections between many of the deals and cross-ownership of businesses involved, it is difficult to say precisely where the government's fault started and ended. A minimum loss to the state of $600M has been reported.

And that is what Senator Back was talking about when he said that Western Australians are still paying for that criminal activity by the Labor Party back in the 1980s.

Now, fast forward, because this fixation by the Labor Party and the Greens in trying to attack Senator Brandis is quite comical, frankly. They have had one attempt at doing it; they set up this dodgy committee to inquire into some very administrative matters with the Solicitor-General. Now, the Solicitor-General was appointed by Labor in the dying days of the Rudd-Gillard-Rudd government. But Labor and the Greens in this chamber thought that here was a chance to destroy the Attorney-General.

So they had this wonderful inquiry—they had written the report before the inquiry started, that is how dodgy the inquiry was. It was a majority Labor-Greens thing, with four Labor, one Green and two government senators. So they set out to destroy Senator Brandis, the Attorney-General. But who did they end up destroying? Their mate the Solicitor-General, Justin Gleeson, who did the only thing possible—the right thing in the circumstances—and resigned. I am looking forward to this inquiry because I just wonder which Labor mate is going to get it in the neck as a result of this witch-hunt.

Senator Brandis is a very skilful politician. He is a brilliant lawyer and he is a very good Leader of the Government in the Senate. The Labor Party and the Greens hate him because they get nowhere in question time. Senator Brandis just flicks their attacks off as if they were flies landing on his forehead! And the Greens and Labor keep at it and at it to try to destroy the Attorney-General. They will not do it—I am giving them some advice now. But they will persist and they will end up destroying one of their own.

Do you know why I am looking forward to this inquiry? It is because we might just call Mr Bob Hawke, the former Labor Prime Minister. We might see if we can get Brian Burke, the former Labor Premier of Western Australia, who I think is probably out of jail by now. We might call him along. We might call some of the other Labor luminaries to the inquiry. I think Carmen Lawrence was mentioned. Peter Dowding was the Deputy Premier, was he not, and the successor to Brian Burke? And there was another Labor luminary involved in these things. This inquiry could be real fun, if we get all of these crooks, these criminals—some of whom have served time in jail—to come and give evidence to tell us what the Bell Group was all about. It was as a result of these dealings by the Western Australian Labor government, the Labor Party and these corrupt businessmen—some of them were found to be corrupt—that we have this situation where legal proceedings have been instituted for two decades now relating to the Bell Group shares which were purchased by the government from Robert Holmes a Court.

As my colleagues have explained, the Western Australian government tried to stop the professional litigators who bought into this deal from continuing to waste legal funds from the limited resources that were in the Bell Group that, if liquidated, could have been used to pay off some of the creditors, including the Commonwealth, the state government and many other creditors. But nobody was going to get anything, because these professional funders of litigation—how that all works is another story—did not want to settle. They did not want to come to any resolution, because their profit lies in keeping these court cases going and going forever until the money of the bankrupt company runs out. They get their money in legal fees and the creditors get nothing.

So what the Western Australian government tried to do was say: 'Let's stop this rort. Let's pass some legislation that will get the funds in Bell Group and distribute them fairly to those entitled.' In fact, the letter that Senator McKim talked about, dated 13 April 2015, from the Hon. Mike Nahan, the Treasurer of Western Australia at the time, said, 'Accordingly, the Western Australia government is planning to introduce legislation that will'—and this is the first dot point—'deliver a more rapid financial return to the Commonwealth, the state government and other creditors.' So, in the Western Australian Treasurer's letter, the Commonwealth was to be the first one to be paid. The second dot point says, 'Eliminate further speculation by professional litigation funders.' Then it goes on, 'Ensure no redistribution,' et cetera. There is something greatly conspiratorial about this letter, according to Senator McKim, but there it is. It is a public letter; you can see it. The Commonwealth was going to be the first favoured.

That letter was responded to by the then Commonwealth Treasurer, Mr Joe Hockey. Where this great conspiracy comes from that Senator McKim and the Labor senators talked about, I do not quite know. Mr Hockey's response simply says, amongst other things:

I trust the Western Australia government will therefore continue to engage in good faith in the forthcoming mediation processes.

Finally, he says:

Given the significant nature of the proposed course of action, I urge the Western Australia Government to ensure that the utmost probity is evidenced throughout the process so as to ensure that Australia remains and continue to be seen as an attractive destination for foreign investment.

So, regarding this inquiry, those letters are there. I cannot see how Labor and the Greens think they can in any way challenge Senator Brandis. They have asked him questions and wasted question time every day this week so far with ridiculous and repetitive questions, which have got them absolutely nowhere, and will continue to get them absolutely nowhere—because there was no deal. There was no conspiracy.

I have a photo of that lunch with then Labor Premier Brian Burke, then Labor Prime Minister Bob Hawke and a few other very senior businessmen at the time of WA Inc. It would be lovely to get some of them before a Senate committee and find out what WA Inc. and the purchase of Bell Group shares were all about. This has been litigated before, as a result of various nefarious activities. Brian Burke, the former Labor Premier of Western Australia, ended up in jail. This inquiry could turn out to be quite fun.

But, as far as the substantive issue has gone, on Monday morning Senator Brandis voluntarily delivered a very, very lengthy statement to this chamber, in which he carefully and precisely went through all the issues concerning his involvement—which was pretty limited and occurred right towards the end. The statement clearly sets out the real facts. In those facts, there is nothing that really requires answering. Because Mr Justin Gleeson—who I mentioned previously in relation to another inquiry—was involved, suddenly the eyes of the Labor Party and the Greens lit up, and they thought: 'We lost that one. We facilitated poor old Justin Gleeson's resignation as the nation's Solicitor-General, but, hang on, he's mentioned in this. Perhaps we can redeem ourselves by having him somehow involved in a further attack on Senator Brandis on this occasion.' It did not work last time; it will not work the next time.

I just wish the Labor Party would use the remaining time of this parliament this year at question time to ask questions about education, about health, about infrastructure, about border security, stopping the boats—but we do not hear any of that. All we hear is this fixation with Senator Brandis, and they will continue with that. Eventually the penny will drop and the Labor Party will again end up with egg on their face. I am looking to seeing which Labor mate is destroyed by this Labor-Greens inquiry into the Bell Group shares issue when this next inquiry comes up. It is an inquiry in which, again, there will be four Labor-Greens senators and only two government senators, but I do not think it really matters because the facts will speak for themselves. It will get nowhere and, as I say, I am looking forward to seeing who is destroyed.

Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

As a servant to the people of Queensland and Australia I ask: what is a measly $300 million among friends? What is $300 million? The subtlety of the language betrays the core belief, and here it is: the government's willingness to enter into an arrangement to forgo $300 million in tax revenue in order to benefit their political allies. Senator Gallacher's stated belief is exposed in the use of the word 'forgo'. It is not the government's money by right, it is not tax revenue by right—that language simply reflects the government's air of entitlement, the Senate's air of entitlement. It reflects the air of entitlement of both the Labor Party and the Liberal Party. This is a betrayal of the underlying intent behind the Labor Party and the Liberal Party in governing this country for the last seven decades. It also brings to mind the corruption of language around tax. We have so-called savings measures that are really tax increases. This reminds us of Stalin's abuse of language and the marshalling of language as a force to suppress people.

As I understand it, the government has three roles. They are to protect life, to protect property and to protect freedom. Yet it seems to me that the solution within the Labor and the Greens parties is to increase tax rates, and the solutions in the Liberal and National parties focus on cutting spending. So it is either cut spending or raise revenue. But there is a third alternative—lowering tax rates. That has been repeatedly proven successful, in Reagan's America, Thatcher's Britain and many other places throughout history. In fact, it was also proven successful in John F Kennedy's America, in the 1960s,

It is absurd and reckless spending that now drives government. There is no accountability in this chamber or in the House of Representatives, because we rarely see cost-benefit analyses on major spending items, let alone trivial spending items. Think of the national broadband network, the NBN—worked out on the back of a beer coaster in the middle of a flight by then Prime Minister Rudd and Minister Conroy—$50 billion, $60 billion, $70 billion? How much? When will it end? We do not know. What will the service speed be? We do not know. There is no business case, and we see the frittering away of our money.

Then we think about climate policies, with the Clean Energy Finance Corporation costing $10 billion—but none of the climate policies have a cost-benefit analysis, and these policies are costing tens of billions of dollars. It is not only the tens of billions of dollars spent, and wasted, but there is also disruption to industry and disruption to productivity, which ultimately costs everyone. We recently have seen the backpackers tax—and apparently someone on the staff of the Treasurer has said there was no cost-benefit analysis done. Now we have farmers being disrupted because of the threat of people not coming to Australia to pick their fruit. No cost-benefit analysis, and suddenly people are wondering why we are $356 million in debt. That is only 1,000 times $300 million—and what is $300 million among friends? Among friends, $300 million leads to a mentality that just wastes money, just fritters it away, with no accountability, and pretty soon that measly $300 million becomes $356 billion. That is our taxpayers' money.

Then we see our tax system based on raising revenue by cutting things like payrolls, things like employment—because we all know that when we tax something we cut its use. Payrolls are taxed—why? Employment is taxed through PAYE tax—why? The request from employees to have more money in take-home pay leads to very high gross income, which puts people out of work. So what is $300 million among friends? It is thousands of jobs and inefficiencies, and instead of people being servants of government we need to get back to governments serving people. Let us make Australia great again for everyone, with comprehensive tax reform. (Time expired)

Malarndirri McCarthy (NT, Australian Labor Party) Share this | Link to this | Hansard source

Three hundred million dollars of taxpayers' money matters in terms of how the money is spent and what is going on. There are so many unanswered questions—there is too much ducking for cover; too much ducking and weaving. Who is responsible; who is telling the truth and who is not? These are questions that the Australian public need answers to but we are not getting those answers. When we think about Western Australia we remember the almost 300 communities that were set for closure. People's lives in the remote areas of that state were being questioned—where they were going to go; how they were going to live—so, when we see cuts to services in the federal budget of nearly $500 million, of course we have to ask what is happening to $300 million.

It is all very well for ministers and members opposite to say that, in the statement by the Attorney-General, all questions have been answered. In fact, they have not been. The Attorney-General's statement has shown that there are so many more critical questions that need answering. What was the understanding between WA Treasurer Dr Mike Nahan and Mr Hockey over the federal government not intervening to challenge the legislation in the High Court? What has Mr Hockey said in recent days in response to what is going on here in the parliament? What role have other government officeholders played in this? Why did the federal Minister for Social Services go to see Senator Brandis about this matter in early March? What did the former WA Treasurer put to the Attorney-General about the issue? Remember we are still talking about taxpayers' money and the extent to which the Attorney-General was involved in legal proceedings designed to recover this money. These are very valid, critical, important questions not only to the Senate and not only to the parliament of Australia but to the Australian people.

Why does the Attorney-General say that he only became involved when the former WA Treasurer, now Minister for Social Services, talked to him about it in March? This is despite the Attorney-General being represented in an earlier High Court hearing of the matter on 8 February. Was the Attorney-General somehow unaware of any of the facts in a High Court hearing where he was being represented? It is absolutely murky—totally murky. As the Senate, the house of review, we have to ask these questions. As uncomfortable as these questions may be to members opposite, to ministers in the Australian government and to ministers in the Western Australian government, they are questions that must be asked and must be answered.

Previous speakers have spoken about the Labor Party's supposed fixation on this issue. Well, clearly we know that it is important. It is not comical to not know what is going on here. It is not comical to see a former Solicitor-General have to resign from his position when he stood for particular values of accountability, transparency and giving competent legal advice that was required in this situation. These are things that do need examination. To hear members opposite speak as though we on this side of the House have an obsession and to hear them belittle the importance of questioning these matters says a lot about the members opposite; it says a lot about the disrespect that they hold for the Australian people's money and the way it should be spent—especially when there are Australians out there who need resources and who need to know they are supported in infrastructure, health, education and housing. There are so many more questions to be asked. We will certainly keep the members opposite on their toes in regard to this issue.

Gavin Marshall (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

The time for this discussion has now expired.