Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard   

Previous Fragment    Next Fragment
Wednesday, 29 June 1994
Page: 2276


Senator IAN MACDONALD (12.55 p.m.) —I support my colleague Senator MacGibbon in his call for this matter to be investigated by the Auditor-General. It is interesting that this matter is of such major importance that both Senator MacGibbon and I have been working on it—and, I might say, until recently unbeknown to each other. It is a matter that has concerned various members of the Brisbane Aboriginal and Torres Strait Islander community and we have been approached independently, in both cases because there is very great concern about what has happened to the Brisbane Tribal Council Ltd.

  The company was established by Donald Davidson in 1977 and has been representative of the Aboriginal community in the greater Brisbane area since that time. It is the largest Aboriginal organisation in Queensland. The objects of the company show that it was established to provide accommodation for Aborigines and Torres Strait Islanders and to assist them in obtaining social welfare. The company owned and operated four properties: the Gwandalan Community Correction Centre at Woolloongabba; the DB Walker Lodge, which is a bail youth hostel at Morningside; the Georgina Thompson-Davidson aged care hostel at Morningside; and the Purga Mission at Ipswich.

  The Gwandalan Community Correction Centre acts as a halfway house for prisoners released to work, and up to 25 inmates reside there. The DB Walker Lodge is the bail youth hostel to accommodate Aboriginal youths released from court on bail and can accommodate up to 25 people. The aged care hostel is a hostel to cater for sick and aged in the Aboriginal and Torres Strait Islander community and has two houses, one providing for patients who require medical treatment and the other caring for patients who are totally dependent on trained medical staff. There are about 20 residents of that hostel.

  The company is a non-profit generating entity and is totally funded by various government grants. Gwandalan is funded by the Queensland Corrective Services Commission and the commission pays a management fee of almost $400,000 per annum. The DB Walker Lodge is funded as to capital by ATSIC. The aged care hostel is partly funded by the Commonwealth Department of Health, Housing and Community Services, as it was then called, partly by ATSIC and partly by pensions of the tenants of the hostel. In addition, ATSIC funds the secretariat of the company. In all, collective funding for the company is in excess of $1 million per annum.

  The company is unable to pay its bills and a receiver-manager has been appointed. At the time of the appointment of the receiver-manager, the company had liabilities consisting of a $62,000 overdraft to the Commonwealth Bank; nine other overdrawn accounts to the Commonwealth Bank totalling some $200,000; leases of vehicles with an indebtedness of $30,000-odd; debts owing to unsecured creditors—that is, small businessmen around the Brisbane area—of $135,000; and unremitted group tax of approximately $60,000.

  The good work the Brisbane Tribal Council did in the past has been put in jeopardy by threats from Telecom to disconnect the phone, from the Commonwealth Bank to call in loans, and by the fact that, if the company is put into liquidation by any of the unsecured creditors, the whole thing will collapse and those Aboriginal people requiring accommodation and assistance will have nowhere to turn.

  A very courageous Aboriginal lady by the name of Elizabeth Ditton, who is also secretary of the company, in an attempt to extricate the company from its financial problems and to allow it to continue its work arranged for the appointment of the receiver-manager. Ms Ditton was appointed a director of the company in December 1992 and was appointed secretary in February 1993. As secretary, she arranged for an investigation of the company that uncovered massive fraud involving hundreds of thousands of dollars and extending back at least 10 years. My colleague Senator MacGibbon has mentioned some of that.

  An unknown portion of the state and federal moneys paid to the company for the operation of Aboriginal hostels and care for Aboriginal aid persons and the supervision of Aboriginal businesses was, instead, being syphoned off into the pockets or homes of company officers and their relatives and associates. Public moneys have been spent on items such as hire cars for prisoners under care, home renovations and travel; and there are large sums of money that are simply unaccounted for.

  Curiously enough, this fraud has remained undetected during yearly audits conducted since 1988 by Ken and Don Hayward, chartered accountants, of Brisbane. I understand that Ken Hayward is, as well, the Queensland Minister for Health. The receivers, upon appointment, found that the deficiency in funds, thought to be in the range of $360,000, was actually more in the vicinity of $600,000. The receivers in their report to the Queensland Supreme Court highlighted the need for an investigation to determine whether the funds provided by Commonwealth and state funding bodies had been misappropriated. The receivers' report is filed in the Supreme Court. It says:

. . . it became apparent that a number of large value cash cheques had been written, which had no supporting vouchers or documentation. Further, it was determined that the cash book section, to a certain extent, may not have reflected the actual nature of the expense.

Further investigations carried out by Ms Ditton and the Sunday Mail investigative reporter Phil Dickie showed that Mr Davidson personally received $21,268 from the Brisbane Tribal Council in May 1993, the month before he died. Only about $2,000 was in the form of salary for his job, the balance being made up of `consultancies', `hire cars' and `security', and also a `personal loan' of $10,000, which I understand my colleague has mentioned. In addition, he signed more than $2,000 worth of cash cheques for unspecified purposes. According to the investigations of the Sunday Mail, in December 1992 there was a record of a term deposit of $100,000 being made, but beyond that date no records of that money exist.

  The investigation also revealed evidence of `ghost employees' being paid huge amounts. In fact, in 1991 the company was required to reimburse more than $6,000 in subsidy payments to the Commonwealth Employment Service after it was discovered that five trainees who were supposedly working for the company were not actually working for it. A $62,000 overpayment by the Queensland Corrective Services Commission was demanded by the Queensland minister to be repaid, but the receiver's report shows that in excess of that amount is still shown as owing to the Queensland Corrective Services Commission, which means that none of that $62,000 incorrectly paid has yet been refunded.

  In late 1993, the Queensland parliament was assured that there were no irregularities in the administration of the Corrective Services Commission contract with the company, but the Sunday Mail reports that gangs of prisoners performed at least some of the extensive renovation and extension work carried out at the home of Mr Don Davidson. Documents I have in my possession also show that some prisoners under so-called supervision of the company were listed as drivers of Hertz hire cars rented by the Brisbane Tribal Council. There is a suggestion, from documents and correspondence I have in my possession, that up to $30,000 worth of improvements were made to the home of Don Davidson by the company. The Courier-Mail reports that the company also paid for much of the repairs and maintenance to Mr Davidson's household and that, as well, the rates on Mr Davidson's property in Cooktown, in Far North Queensland, were paid by the company.

  Numerous members of the Davidson household used hire cars in Brisbane, and Davidson's wife, Marlene, acting in the capacity of a coordinator of the hostel, provided her own authorisation to use hire cars. Large amounts were expended on furnishings, often at upmarket outlets, supposedly for use at the youth hostel, but Ms Ditton's investigation cannot locate the majority of those items that were supposedly purchased. The books of the company show a large number of cheques being written out to cash, and the making of personal loans to company officers. I have in my possession accounts for large sums of money spent at florists and upmarket crockery and cutlery retail outlets.

  An accountant who has been assisting Ms Ditton in her investigation indicated that, if he had been auditing the books, he would have wished to check entries off against invoices. This was obviously not done. In spite of audited reports by Ken and Don Hayward, chartered accountants, over the years, the accountants appear never to have raised any concern with the irregularities. It is now becoming obvious that many leading auditors around this nation had adopted a fairly laissez-faire attitude to audits of major companies. I am pleased to see that some of these high profile auditors of major companies are now being taken to court by creditors to account for their indifference.

  The receiver's report to the council recommends that a detailed investigation be made to determine whether funds provided by funding bodies have been misapplied and specifically says that the level of wages should be reviewed for any excess of variations. The receiver's report also recommends that funding grants should be traced to determine the correct use in accordance with the purpose for which the grants were given, and again it says that Messrs Ken and Don Hayward should be asked for explanations. The 1992 financial statements of the company, which have been audited by Ken and Don Hayward, chartered accountants, show that the accountants received in excess of $20,000 in audit fees in that year alone.

  Copies of the correspondence I have in my possession also show that Mr R.A. Robinson, well known as Sugar Ray Robinson, a Charleville-based Aboriginal leader, ATSIC commissioner and national chairman of the Aboriginal Legal Service, had advised Don Davidson on how he should go about purchasing his house property, at a substantially discounted price, from the Aboriginal authorities. Interestingly, a few months later correspondence signed by Mr Davidson, which I have in my possession, shows that Mr Robinson was paid by the Brisbane Tribal Council an amount of $3846 said to be `wages for eight weeks work experience' at the Brisbane Tribal Council Ltd. The letter forwarding Mr Robinson his money says that the company hopes the knowledge Mr Robinson gained while receiving `work experience' with the company would be of benefit to him in the future. It is a most unusual way in which work experience recipients are paid almost $500 a week for the work experience. However, this amount was not paid in weekly instalments but, rather, was paid in a lump sum. The Courier-Mail reports as well that Mr Robinson has been paid wages or consultancies over short periods in 1988, 1989 and 1991.

  ATSIC is well aware of the problem of the company, and the Australian Government Solicitor, on behalf of ATSIC, has taken action to protect some of the company's assets from the receiver. The Commonwealth of Australia has also issued a notice of exercise of power of sale, under a mortgage the Commonwealth apparently has, to secure moneys said to total in excess of $837,000 due and payable to the Commonwealth of Australia as mortgagee. Interestingly, in spite of the recommendations of the receiver in his report to the Brisbane Supreme Court dated 8 October 1993, and in spite of a two-page expose in the Sunday Mail of 8 May 1994, it seems that neither the Commonwealth nor the state government appear to have taken any interest whatsoever in the alleged misappropriation of moneys supplied by governments for the welfare of Aboriginal and Islander people in the Brisbane area.

  In raising this matter, I pay particular tribute to Elizabeth Ditton, the company secretary, whose action in putting the company into receivership and then publicly exposing the fraud has made her many enemies in the Aboriginal community. Ms Ditton has courageously raised this matter and has called for a full inquiry because she fears that at any moment any of the unsecured creditors could apply to put the company into liquidation, which would then take away from Aboriginal people in the Brisbane area the support and assistance for which the company was established.

  Ms Ditton is a very intelligent and capable woman and she takes her role as company secretary very seriously. In the 1950s she was forcibly separated from her family and put into a home. She was schooled at a convent and dreamed of becoming a doctor; and I think scholastically she would have been quite capable of doing that. Unfortunately, those avenues were not then available to a black ward of the state. I have had the honour of a long meeting with Ms Ditton, and she tells me that, since raising this matter publicly, she has been abused and assaulted on a number of occasions and her life has been threatened.

  As Ms Ditton's expose and that of the Courier-Mail and the receiver appointed by the Supreme Court have drawn absolutely no response whatsoever from either the state or federal government, I have raised this matter in parliament to call upon ATSIC, the Department of Employment, Education and Training and the Commonwealth Department of Human Services and Health, the successor to the Department of Health, Housing and Community Services, to investigate fully whether fraud has been involved in huge sums of money provided by the Commonwealth government to the Brisbane Tribal Council Ltd over the years. Nothing less than a full investigation and report to parliament will suffice to expose this fraud and outright theft.

  I support most strongly the call made by my colleague Senator MacGibbon in his letter to the Auditor-General for the Auditor-General to investigate fully and properly all aspects of the Brisbane Tribal Council and the money it has received from state and Commonwealth governments.