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Thursday, 14 August 2003
Page: 18591


Mr LATHAM (2:52 PM) —My question is to the Treasurer. When he appointed Mr David Knott as Deputy Chairman of ASIC in 1999 and then as chairman in November 2000, did the Treasurer check the corporate governance and integrity record of all the firms that Mr Knott had been involved with, including Collie Knott and Co.? What did these checks reveal?


Mr COSTELLO (Treasurer) —When an appointment is made to a Commonwealth government post, one gets advice from a department, normally one gets advice from the outgoing regulator and, in cases such as ASIC, one consults the states. Can I say that in all of my dealings with the department, with the previous regulator and with the states, not only have they never raised any objections to Mr Knott; in fact they have been very laudatory.


Ms Macklin —Did you check?


Mr COSTELLO —They have not raised any objections, as I have said—none whatsoever. No objections have been raised by either the states or the previous regulator—or indeed by the federal opposition. In fact, quite the contrary: the view has always been and still is, to my knowledge, that Mr Knott was eminently suitable for the job. Not only was he eminently suitable for the job but he performed a first-class job. Senator Stephen Conroy is of that view. Henry Bosch is of that view; he is a former chairman of the NCSC and was quoted in the paper today as saying Knott has done `a great job'; Knott has been `very successful'. Alan Cameron, and I am talking about the checks, Mr Speaker—


Mr Latham —On a point of order going to relevance, Mr Speaker: the Treasurer is talking about things that have been said in the media—


The SPEAKER —The member for Werriwa will resume his seat.


Mr Latham —over the last few years—


The SPEAKER —The member for Werriwa will resume his seat. These are not substantial points of relevance. In fact in this instance the Treasurer is running through a number of the people at state level with whom he had checked. He is being entirely relevant and I recognise him.


Mr COSTELLO —Mr Speaker, as I said, one makes checks with the department, one makes checks with previous regulators. In all of the checks that I have made, Mr Knott has always been warmly endorsed—and warmly endorsed as recently as two days ago by the federal opposition. Can I say I am not aware if it is now opposition policy to believe that Mr Knott is not suitable, because up until the questions were asked by the member for Werriwa the tributes to Mr Knott were flowing from the Australian Labor Party. Now we have the official spokesman of the Australian Labor Party, who believes that Knott has done an outstanding job, and we have the member for Werriwa, who has already risen in this House to complain about proceedings against Mr Nicholas Whitlam now going to the High Court. The Labor Party can make up its mind whether it wants to side with Senator Conroy or the member for Werriwa. If I were a member looking at this, I would think Senator Conroy had a lot more understanding of this particular issue than the member for Werriwa, who may well lead you into a blind alley.

I talked about checks with previous regulators. What does the previous regulator, Mr Cameron, say? Mr Cameron, who spent eight years as ASIC chairman, described Mr Knott as a `highly effective' chairman. The President of the Australian Shareholders Association praised him as `heightening awareness of the regulator' and `successfully pushing the corporate governance issue'. Dick Humphrey, the CEO of the Australian Stock Exchange, said:

He has held up remarkably well compared with those overseas. Aided by its high reputation for integrity, ASIC under Mr Knott's leadership has contributed significantly to this outcome.

Catherine Wolthuizen, the Finance Policy Officer of the Australian Consumers Association, said:

Mr Knott has been a very effective regulator at a particularly difficult time for ASIC.

Professor Ian Ramsay knows a little bit about the area, Mr Speaker. As I said earlier, what is the allegation that the FinancialReview story makes? They say it themselves in the article; I read it out earlier. They make no allegation against Mr Knott other than that a previous partner of his had been involved in tax avoidance activity, and if a previous partner of his had been involved in tax avoidance activity then that previous partner should bear the full weight of the law. But what is the allegation against David Knott? Guilt by association. Who would you expect in this parliament to run hardest on the issue of guilt by association? The grub that has come to the dispatch box and raised these issues.


The SPEAKER —Treasurer!


Mr Costello —I withdraw the word `grub'.