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Wednesday, 1 April 1998
Page: 2112


Mr CREAN —My question is addressed to the Prime Minister. Prime Minister, you claim not to have declared your directorship because you thought it a trivial matter. If directorship of a company in receipt of $400,000 of taxpayers' money and significant tax concessions is too trivial to declare, wasn't honorary membership of the International Fellowship of Cricket Loving Rotarians and receipt of, and I quote from you, `various books, key rings and biros which are either in a Canberra office or in the library at the Lodge' even more trivial? Prime Minister, do you really expect us to believe that a man who declares key rings and biros simply forgot to declare both his directorship and resignation from a public company which benefited directly from decisions that he took in its favour?


Mr HOWARD (Prime Minister) —Mr Speaker, I do regard this matter as being trivial, but given the amount of time and energy that the honourable member for Hotham and others in the Labor Party, with varying degrees of intensity and confected outrage, have put into it, let me take the honourable gentleman through the circumstances. The first and most important point to make is that at no stage did I have any personal pecuniary interest in this company. The second point I ought to make is that I held the position by virtue of the fact that I was leader of the federal parliamentary Liberal Party—hardly a closely held secret. This is a great revelation: the Labor Party have discovered I have a closet association with the Liberal Party of Australia! It is extraordinary. It is an amazing thing. Shock, horror! I am undone; I am exposed! I am the leader of the federal parliamentary Liberal Party.

Even more importantly, a lot of reference has been made to the fact that this is a public company.


Mr Fitzgibbon —The job is yours, Peter.


Mr SPEAKER —The honourable member for Hunter will remain silent.


Mr HOWARD —The Leader of the Opposition and Mr Oakes on his program last night and in his Bulletin comment this morning, and others, have made great play upon the fact that this is a public company. Let me point out to the House that the words in the ministerial code—and this is the basis of my rejection of any claim that there is a conflict with the code—


Mr Fitzgibbon —You are looking better, Peter.


Mr SPEAKER —I warn the honourable member for Hunter.


Mr HOWARD —The words `public company' are not defined in the code as carrying the meaning given to that expression under the Corporations Act. Indeed, Mr Speaker, if you go to The Australian Concise Oxford Dictionary , you find that a public company—and I repeat this for the benefit of all of those who have sought to claim that I was in conflict with the code—is defined in the Oxford dictionary as a company that sells shares to all buyers on the open market. Let me repeat that: sells shares to all buyers on the open market. The reality in relation to the Menzies Research Centre is that it has no shareholders. If it doesn't have any shareholders it is a bit hard to sell any shares, isn't it?


Mr Melham —You are from the Melbourne Club. That is what you are—the Melbourne Club.


Mr SPEAKER —The honourable member for Banks will remain silent.


Mr Fitzgibbon —Well, why did you resign only of the—


Mr SPEAKER —I have already warned the honourable member for Hunter. If he wants to stay here, I suggest that he remains silent.


Mr HOWARD —Mr Speaker, let me quote from the letter written to me by the Federal Director of the Liberal Party—and I would be very happy to table it—dated 31 March 1998. It spoke of the Menzies Research Centre—and it is called the Menzies Research Centre, not the name given to it by the honourable member for Hotham. Freehill Hollingdale and Page had this to say:

A company limited by guarantee has no shareholders. Such companies are limited companies because a member's liability to contribute to the company is limited to the amount of the guarantee. In the case of the MRC, the amount is $10—


Mr Melham —You'll be a trivia question in history. That's what you'll be.


Mr SPEAKER —I warn the honourable member for Banks.


Mr HOWARD —The quotation continues:

Such a company has no issued shares, but has administrative advantages such as simplifying procedures for admission to membership.

It goes on to say:

While technically a public company, for the reasons described above, a company limited by guarantee can be distinguished from a public company which consists of shareholders whose shares are traded on the stock exchange and which has as its primary function a commercial and trading purpose.

It goes on to say this:

At the time of the MRC's creation, a number of individuals closely associated with the Liberal Party of Australia became directors—

and I have to confess that I was one of them, because I was closely associated with the Liberal Party—

Some of these became directors pursuant to their positions within the party. For example, Tony Staley as federal president became a director—


Mr Martin Ferguson —All weasel words—weasel words!


Mr SPEAKER —The honourable member for Batman will remain silent.


Mr HOWARD —The quotation continues:

John Howard became a director as leader of the Federal Parliamentary Liberal Party.


Mrs Crosio —Why did you not declare this?


Mr SPEAKER —I warn the honourable member for Prospect.


Mr HOWARD —Freehills go on to say:

We understand that this is one of the many responsibilities which the leader of the Federal Parliamentary Liberal Party takes on as part of his official role within the wider party organisation. Other responsibilities of the leader include being a member of the federal executive of the Liberal Party—

and so on. Let me go on to say that article 4.3(a) of the articles of association of the centre provide that directors must not be paid fees for acting in their capacity as directors. Article 4.3(b) provides that directors are entitled to be paid all travelling and other out-of-pocket expenses. But, because I didn't undertake any on behalf of the centre, I have to say the I did not claim anything. It goes on to say:

The MRC is a non-profit organisation formed for public policy purposes and operates on a not-for-profit basis. At the time of its establishment, we understood the MRC to be an offshoot of the Liberal Party of Australia, established to advance the liberal philosophy supported by the party. Given its nature, the MRC may be distinguished from that of a popularly understood conception of a public company run for profit motives. This is because there are no shares to be traded, it is not involved in activities for profit, and its members and directors do not gain any financial benefit from their role with the company.

I not only reject the honourable member's question, but also reject the claim that I am in any way in conflict with the code of conduct.


Mr SPEAKER —I call the honourable member for Eden-Monaro.


Mr Lee —Could he table the document?


Mr HOWARD —I table the document.