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Thursday, 9 May 1985
Page: 1640

Senator CHANEY —I ask a question of the Minister for Finance arising out of the answer that he has just given. Is he suggesting in saying that many millions of dollars of the Totalisator Administration Board of Queensland funds were at risk, that there is some financial doubt? Is he casting some financial doubt over the bank known as Rothwells? If he is, I think he should clarify that instead of giving rise to inference in the way in which he has. I further ask: If that is the case, is he concerned about any connections between the managing director of that bank and the Australian Labor Party in his home State of Western Australia? Does he regard that as also a matter which should be splashed around this Senate and made subject to comment?

Senator WALSH —So far as I know, no public funds or funds from statutory bodies responsible to a government have been invested from Western Australia in Rothwells Ltd. I make no assessment of that company. I simply state the facts that as a merchant bank it does not have lender of last resort cover from the Reserve Bank of Australia and nor is it subject to the prudential controls of the Banking Act. It is not customary in public finance in Australia that very large amounts of money-and $28m by anyone's standards must be counted as a very large amount of money, even for a big public authority-are lent other than to some sort of secured borrower. I do not know what the accounts of the Queensland TAB show but I would have thought that $28m would be a very substantial component and even perhaps close to all the liquid assets that the institution in fact has. When we have on top of that rather unusual behaviour the fact that the chairman of that public authority is a director of the merchant bank to which that money was lent and a very close friend of the Premier, it is very clear, I think, that something is very much wrong in the State of Queensland.