Rex Patrick (SA, Independent) Share this | Link to this | Hansard source

In accordance with standing order 74(5), I seek an explanation from the minister representing the defence minister as to why question on notice No. 3359 has not been answered.

Marise Payne (NSW, Liberal Party, Minister for Foreign Affairs) Share this | Link to this | Hansard source

I don't have specific information in relation to question No. 3359—I was not aware that you were raising this today—but I will seek further information for you from the defence minister's office.

Rex Patrick (SA, Independent) Share this | Link to this | Hansard source

I move:

That the Senate take note of the minister's failure to provide either an answer or an explanation.

I did inform the minister's office, or raised a question in the minister's office, this morning in relation to these questions. It indicated that I might exercise my rights at the end of question time. I'll just let the chamber know what this question is about. It's an important question about defence industry. I have four questions. The first is: what is the current status of the mapping or matching of industry capability to defence requirements? This is something that Defence had indicated they were undertaking, and it was merely a question to try and find out what the status was. I also asked a second question: how is the department capturing or documenting this? The third question: Dr Sawczak advised that the government was working with EBS on a feasibility study to enhance the mapping. What is the status of the feasibility study? Again, that's quite a reasonable question. The final question was reminding the department or the minister that Ms Kate Louis, as the first assistant secretary of defence industry policy, had previously stated to the Senate committee that such work was being done in 2016 and 2017, so I just wanted to know what happened with the work and the associated plans and what the output was of that work. These are important questions that go to defence industry and the use of Australian industry in our defence projects. It's much, much easier for the department to operate if it has a prior understanding of exactly what industry is able to do.

Now, comfort is the enemy of progress. What we've been seeing for far too many years is comfort, and there shouldn't be. The government needs to wake up in relation to industry capability from not just a defence perspective but a national resilience perspective, and I'll talk briefly about that. World War II forced us to do this. In late 1942 the government was considering postwar reconstruction, and we had a division of government called the Division of Industrial Development. It was aimed at developing and expanding secondary industry in postwar Australia in areas that included rural reconstruction; the conversion of munitions and armaments factories for other industrial uses; and encouragement for an Australian car-manufacturing industry, workforce training and employment opportunities, electricity supplies, fuel production and industrial technology. That was what we were doing at the end of World War II—in fact, well before it ended—to make sure we had a plan coming out of it.

Now we have COVID. The government has done a reasonably good job, or it did a reasonably good job at the start of COVID. I won't talk to the vaccine rollout and the lack of quarantine facilities, but a reasonable job was done at the start to protect Australians. We did call on Australian industry to assist us in that regard, making sure that we had medical supplies and things like PPE. Sadly, all of that emphasis seems to have tapered off. The government's approach to Australian industry has been demonstrated by the department. It seems to be that industry should be standing by ready, willing and able should government decide to engage them. That often happens when we've got a foreign supplier that gets us into a mess or when it's an emergency, but there's a general belief that Australian industry will be ready and waiting and that they'll be there when we need them. That's an unfair proposition, and it's also not a reality. There's a saying: use it or lose it. If we don't have our industry, if we're not engaging our industry, then of course it's going to taper away and it's not going to be there when we need it.

Whilst I can use defence as a reference point, the problem is not strictly limited to defence. We have the largest island nation and yet we have no merchant navy. That has a corresponding impact on shipbuilding and sustainment. We have tier 1 contractors that are all foreign owned. All those large projects that we're developing under the extra $10 billion of money that has been provided by the government in the budget has to go to foreign owned companies, because our companies, the Australian owned companies, are tier 2 companies. That simply means that we're handing over those functions to foreign companies. We have dwindling offshore oil and fuel refining. We can see that listed on the Notice Paperthe need to weigh in and support our refineries. Even when we asked the four remaining refineries to stay in Australia, only two of them took up the offer. We will be dealing with that, but we shouldn't be in this problem. We're also reducing textile production. Last year when I asked Defence, 'Where's the map—where's the thing that tells us how we integrate our industry capability into our defence capability?' we were told that there was work going on but that they don't have one.

We can look at things like the Commonwealth Procurement Rules. They were changed in 2016. They require officials to achieve value for money. Of course we want that. But for procurements above $4 million—or $7.5 million for construction services—we also require officials, in accordance with the rules, to consider the economic benefit of the procurement to the Australian economy. This hasn't been happening. Even since the August 2020 guidelines were issued, it still doesn't seem to be happening. What we need to be doing is making sure, whenever we buy something with Australian taxpayers' money, we look to the economic benefit that comes from selecting a particular entity for doing that. That includes looking at how many jobs they might create. How much investment might they make here in Australia? What are the supply chain effects of going with a particular tender? These questions are required in our rules, but are not followed through. One of the reasons I think they're not followed through is because departments like Defence simply don't have the tools to be able to work out the trade-offs between taking one particular option versus another option and understanding what the economic benefit of that is, because the government simply is not tooling them up correctly. What we shouldn't be doing is just saying, 'What is the cost, what is the price.' We should be saying, 'What is the value of going with a particular contractor,' but we're not doing that.

We have a requirement to have Australian industry participation plans developed. The AIP Authority—it's under the Australian Jobs Act—basically needs a revolving door for the number of people who pass through that office. It's a continual churn. We do have Australian industry capability plans, but the reality is that these plans are not being implemented and enforced. I've seen the plan that was offered up by Naval Group, then DCNS, for the future submarines. It was actually a good plan. It involved partnering with ASC. It involved establishing a whole bunch of centres of excellence. It involved developing technologies here in Australia. These are exactly the sorts of things we want to do with an Australian industry capability plan. And yet, we find what was contracted by Defence was nothing along those lines. They did everything they could do to avoid ASC, and they did everything they could to avoid contracting in the very things that DCNS promised. I also note that, in that particular contract, even though—I've seen this in the documentation, where Naval Group did offer metrics. They offered 50 per cent. We didn't contract that. We have recently had to retrospectively contract in 60 per cent. That's a huge problem. You can't ask people to front up with an AIC plan, assess them on the quality of their AIC plan and then just put it in the back drawer.

One of the problems I think we have is Defence people concentrate on Defence. They don't think about Industry. Recently we tried to have Industry driving some of this in the Defence space, and Defence pulled it back in under their wing, I guess so that industry players didn't have to be or wouldn't be loud. There's a whole range of things we need to be thinking about in relation to this. We've just seen, with the Boomeranger contract, Australia contract out a whole bunch of sea boats when that's something we can do here in Australia. Indeed, under World Trade Organization rules, because it's defence related, we can overtly state we are going with an Australian company, and yet we don't seem to do that.

I'll tell you the story of how uncoordinated we are. We had a company, an Adelaide company, called Ezy-Fit procure—part of the procurement was paid by them, part of it was paid by the department of industry, to buy machining tools that would allow Ezy-Fit to build periscopes for the future submarines, and, indeed, to assist with sustaining Collins. What happened then? Defence contracted the job overseas. So, the taxpayer lost, and the company lost. They had bought an asset that could no longer be used.

We need people to focus on these sorts of matters. There are many, many things that we can do at the end of COVID. I'll just turn to an executive order signed by the US President on 25 January this year on ensuring the future is made in all of America by all of America's workers. Let me read from that executive order, just one paragraph because it's enough:

It is the policy of my Administration that the United States Government should, consistent with applicable law, use terms and conditions of Federal financial assistance awards and Federal procurements to maximize the use of goods, products, and materials produced in, and services offered in, the United States.

There's leadership from the US President, signing into effect an executive order which must be complied with.

We still have this view here in Australia that we should simply let the market decide. What we have happen here is that the Australian government—and I'm not being critical of what we do here—imposes upon Australian companies minimum wages, leave loadings, holiday pay, long service leave and superannuation. We make them comply with environmental laws. We make them comply with occupational health and safety laws. We make them comply with a whole range of quality regulations. We do that, and that drives cost up. I don't say that's a bad thing. I think that ends up with Australians producing quality products. But then, when the government goes out and procure things, it looks at the price coming in from Vietnam or China or some other foreign jurisdiction where those particular requirements are not mandated. It's not an even playing field, and yet the doctrine of competitive advantage gets played out all of the time on the other side of the chamber. It is not a level playing field. It is not a level playing field when we deal with procurements that involve Chinese companies, because often they are well and truly backed by the state. So let's not pretend this theory of competitive advantage applies.

I've stood up and talked a little bit about Australian industry. It's really, really important. It's important for our resilience and important for our national security. Yet, when I ask a simple question—and remember that I ask these questions not for me but on behalf of my constituents—about what the government is doing to map industry capability to our defence needs, I can't get an answer in a timely fashion. Firstly, that worries me about what's happening behind the scenes, because they ought to be easy answers to come to. But, secondly, it is disrespectful to my constituents, who have a right to know, through Senate processes, what the answers to their questions are.

Murray Watt (Queensland, Australian Labor Party, Shadow Minister for Northern Australia) Share this | Link to this | Hansard source

I rise to take note of the minister's statement, and I particularly want to address remarks that Senator Birmingham made.

Senator Birmingham interjecting—

I wouldn't be quite so smart, Senator Birmingham; you haven't heard what I have to say yet.

Sue Lines (WA, Deputy-President) Share this | Link to this | Hansard source

Senator Watt, Senator Patrick stood on Minister Payne's response to a question he put. That's the matter that we're dealing with—

Murray Watt (Queensland, Australian Labor Party, Shadow Minister for Northern Australia) Share this | Link to this | Hansard source

It's on the government's answers in relation to some questions on notice, and I've been informed I can do this as part of this process.

Sue Lines (WA, Deputy-President) Share this | Link to this | Hansard source

Senator Watt, I am advised as long as it is in relation to the matters that Senator Patrick asked of Minister Payne you are well in order. Please continue.

Murray Watt (Queensland, Australian Labor Party, Shadow Minister for Northern Australia) Share this | Link to this | Hansard source

Thank you, Madam Deputy President. I would submit I am relevant to the point raised by Senator Patrick because my comments also relate to government ministers' statements in relation to questions on notice.

I do want to focus on an answer that was just tabled by Senator Birmingham at the end of question time. It's question on notice No. 3572, which I lodged nearly two months ago. It was a question seeking details from the Prime Minister as to representations made by the former foreign minister Ms Julie Bishop to government ministers on behalf of Mr Lex Greensill or his company, Greensill Capital. It is highly unsatisfactory that it has taken me flagging my intention to raise this today to finally get an answer from the Prime Minister of this country to this question. It does go to government integrity, something that we should be able to expect from our Prime Minister, if not all ministers, in this government. What the question that I lodged nearly two months ago sought was detail from the Prime Minister as to how many introductions Ms Bishop had made between government ministers and Mr Greensill or employees of his firm, Greensill Capital; in what capacity government ministers understood Ms Bishop to be making such communications; and details of the dates and nature of any meetings that did occur between ministers and representatives of Greensill Capital as a result of Ms Bishop's representations.

This matter does have some background, and one of the reasons that we are asking questions about this is that anyone who has followed either the collapse of Greensill Capital or, particularly, developments in the United Kingdom relating to this company, would be aware that quite a scandal has emerged in British politics involving the former British Conservative Prime Minister David Cameron, who was hired as a lobbyist by Greensill Capital. Various text messages, WhatsApp messages and other information have surfaced demonstrating Mr Cameron's abuse of his former role as Prime Minister of the British government and his personal connections to serving British Conservative ministers in pursuit of his client, Greensill Capital, who, as we know, went on to collapse, putting many funds and many creditors in jeopardy.

What we're concerned about, from the opposition's point of view here in Australia, is whether something similar has occurred in relation to the efforts of the former foreign minister Ms Julie Bishop. It's a matter of public record that Ms Bishop is on the payroll of Greensill Capital. She has now registered as a lobbyist on behalf of Greensill Capital, among other companies. She was a bit tardy in updating her register, but she is now a registered lobbyist on behalf of, among other firms, Greensill Capital. So there has been a connection between Ms Bishop and Greensill Capital in the same way that there has been a connection involving Mr Cameron in the United Kingdom.

On 23 April, I submitted questions to the Prime Minister, the Treasurer, the finance minister and the Attorney-General about representations made by Ms Bishop, the former foreign minister, on behalf of Greensill Capital. These were very simple questions. All they tried to establish was what contact had occurred between Ms Bishop and various government ministers regarding her client, Greensill Capital. But it seems that ministers needed longer than the 30 days dictated by the standing orders to get their stories straight. The Attorney-General, who, frankly, should be aware of standing orders, responded to my questions on 8 June. That's 46 days to respond, rather than the conventional 30. Interestingly, the Attorney-General did not respond until after Senate estimates was completed. Subsequently, the Attorney-General tasked her acting secretary with seeking clarification from the former Deputy Leader of the Liberal Party Ms Bishop on the nature of her role with Greensill prior to her registration under the lobbyist code being lodged. As I said: from facts that are on the public record, it does appear that Ms Bishop was undertaking lobbying work on behalf of Greensill Capital prior to her having registered in a public way as a lobbyist for that company. She needs to explain that, and she's been asked to do so by the acting secretary of the Attorney-General's Department. The Treasurer responded to my question on notice on 10 June, 48 days after I submitted my questions and only after it was revealed in Treasury estimates that Ms Bishop, acting on behalf of Greensill, had approached the Treasurer, who then ensured that Ms Bishop and Greensill Capital secured the ear of Treasury officials. All very convenient, all very cosy.

Then the finance minister and the leader of the government in this place also seemed to forget the standing orders and responded to my question on 11 June: that's 49 days after I lodged my question on notice. The Minister for Finance says that he has, 'not ever received communications from the former foreign minister Ms Bishop relating to Greensill Capital'. We can only take him at his word on that. But we do know that the former Minister for Finance and the former leader of the government in this place Mathias Cormann did open the backdoor to his mate Julie Bishop when he met with Greensill Capital in Davos in January 2020. Again, all very convenient and all very cosy—captains of industry and leaders of this government all sitting down having a nice mulled wine around the fire in Davos in the middle of winter.

This meeting that Mr Cormann arranged for Ms Bishop and had with Greensill Capital occurred despite a Department of Finance memo warning the then Minister, then Minister Cormann, that Greensill's scheme for financing, which was being touted to this government, was, 'wages on demand' and 'economically similar to payday lending'. We have a company who the Department of Finance has advised ministers wants to offer a service that is similar to payday lending being promoted by a former minister of this government, Ms Bishop, being facilitated by a former Minister of this government, Mr Cormann, and ministers aren't really keen to talk about what their involvement was. At least though the Attorney-General, the finance minister and the Treasurer answered those questions—albeit exceptionally late.

It wasn't until we flagged today that we were intending to ask Senator Birmingham where the answer to the question to the Prime Minister was that we finally got an answer. There was one minister who it took prompting from this Senate before he was prepared to answer my questions about representations made by Julie Bishop on behalf of Greensill Capital. It wasn't just any minister; it was the Prime Minister of this country. It took 53 days since I lodged my questions, 23 days after they were due, to get an answer—if you can call it that—from the Prime Minister.

I've had a quick look at the answer, if you can call it that, that we've received today to this question. Essentially what that answer says is that the Prime Minister is unable to answer my question. The question, of course, was how many introductions Ms Bishop had made between government ministers and Mr Greensill or employees of his firm. Despite taking 53 days since I lodged this question the Prime Minister now comes back and says he's unable to answer because answering this question would amount to an unnecessary diversion of resources of his department. Again, how very convenient and how very cosy that we have the Prime Minister covering for his mate Julie Bishop, refusing to answer questions about representations that she has made as a paid lobbyist for Greensill Capital to government ministers touting the services of a firm that the Department of Finance has likened to a payday lender. How very convenient; how very cosy.

Why is the Prime Minister wanting to cover up for the activities of his former Liberal colleague Julie Bishop? Why is the Prime Minister covering up the representations that she has made to government ministers on behalf of her client Greensill Capital? Greensill Capital is a company likened to a payday lender by this very government. Is it because we're facing a similar scandal to what we've seen in British politics involving former Prime Minister David Cameron? He was exposed for having made all sorts of private contacts to his mates in the current UK government on behalf of Greensill Capital in return for his payment as a lobbyist for that firm. Is that what we're seeing here with Ms Bishop? We don't know, because the Prime Minister won't tell us. We don't know, because the Prime Minister won't even tell us how many introductions Ms Bishop has made on behalf of her client Greensill Capital to government ministers to promote their services, to promote their payday lending services, which would be offered at the expense of ordinary Australians. This Prime Minister, if he has any sense of accountability, should be answering. He should be telling the Australian public what representations his former Liberal colleague Ms Bishop has made to ministers in this government and what work she has done on behalf of this payday lender—so called by the Department of Finance—to try to generate government business in return for a payment that she receives as a lobbyist for this firm. We deserve to know this.

In the absence of answers from the Prime Minister, we can only go on what has been reported, and that is fairly damning. On 12 April this year, the Australian reported that Lex Greensill sought to win influence with Scott Morrison by dropping in a WhatsApp message to the Prime Minister that he had signed up as a premium platinum member to the Liberal Party's Australia Business Network. So we've got Mr Greensill sending WhatsApp messages directly to the Prime Minister, talking up the fact that he's taken out a premium platinum membership of the Liberal Party's business network, but we can't find out Mr Greensill's lobbyist Julie Bishop has been up to. What WhatsApp messages has Julie Bishop been sending to her former colleagues, in trying to line up business for her client, the payday lender, Greensill Capital? What meetings has she arranged with government ministers to promote Greensill Capital's services? We don't know because the Prime Minister won't tell us. The Prime Minister won't be honest with the public because the Prime Minister wants to cover up for his former colleague Julie Bishop. I understand that premium memberships to this Liberal network that Mr Greensill joined cost around $120,000. Is this why the Prime Minister doesn't want to tell us what his former colleague Julie Bishop has been up to? Is it because he's protecting a very valuable donor to the Liberal Party? $120,000! Not a bad donation to a political party! Is that why the Prime Minister is covering up for Ms Bishop and Mr Greensill? Is it because he doesn't want to jeopardise those donations?

It turns out that, after a Liberal Party business network event in September, the Prime Minister himself met with Mr Greensill on 30 October 2019. This has been confirmed by a spokesperson for the Prime Minister. Was this meeting arranged by Julie Bishop as the lobbyist for Greensill? We don't know because the Prime Minister won't tell us because the Prime Minister is covering up for his colleague Julie Bishop. So we've got an Australian businessman, Mr Greensill, running a payday lending outfit which is mired in controversy at least in the UK, if not in Australia at this point, and which has collapsed, owing creditors significant amounts of money, and he is donating money to the Liberal Party, getting meetings with the Prime Minister through WhatsApp messages that he's sending and hiring Julie Bishop, a former federal minister in this government, to tout his services to ministers, but the Prime Minister won't tell us what his former colleague Julie Bishop has been up to. He won't tell us who she's met with. He won't tell us what WhatsApp messages she's been sending to her former colleagues.

Are we facing our own David Cameron style scandal in Australia, similar to what we've seen in the UK, based on a former Liberal minister of this government using her private connections to line up business deals for one of her own clients? We'd like to know that. I think the Australian people would like to know that. But the Prime Minister won't tell us that because he's covering up for his colleagues and covering up for what seems to be a major donor to the Liberal Party. This stinks of Liberals helping out their mates. We know that they treat taxpayers' money like Liberal Party money, and we're starting to find out that they apply special rules for Liberal mates who make nice donations to the Liberal Party and who like to cosy up with former ministers around the fireplace with a mulled wine at Davos. They're the kinds of people who are protected by this government. They're the kinds of people we don't find out about meetings with because this government has too much at stake. It's about protecting mates who've paid $120,000 to sign up as premium platinum members of the Liberal Party's business network. We deserve answers and transparency. It is not negotiable—and it should not be negotiable—for the Prime Minister to comply with the standing orders and properly answer these questions.

Question agreed to.