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Tuesday, 19 November 2002
Page: 6724

Senator CHRIS EVANS (2:54 PM) — My question is directed to the Minister for Defence, Senator Hill. Can the minister confirm that the former Minister for Defence, Mr Peter Reith, had been given details of all the initial bids for the Defence Integrated Distribution System before he cancelled the process and restarted the tender round in July last year? Can the minister provide an absolute guarantee that the former minister has not conveyed highly sensitive commercial information he possessed from his previous capacity to his new employer, Tenix, which has just won the $900 million contract for DIDS? What steps did the minister personally take to ensure the integrity of this tender round, given Mr Reith's previous involvement and his involvement with the successful bid team?

Senator HILL (Minister for Defence) —This does rely in part on the integrity of Mr Reith, of which I have no doubt at all.

Opposition senators interjecting

The PRESIDENT —Order! Senator Evans has asked a question and members on his own side should remain silent to listen to the answer.

Senator HILL —I will repeat it: Mr Reith is an honourable person. He was a very fine minister and he caused great discomfort to the Australian Labor Party, I have to say, which is why they continue to pursue this vendetta. He was also a very good defence minister, I might say for the benefit of Senator Evans. The DIDS tender process was cancelled by cabinet, as I understand it, before I came to my position. It was restarted and all bidders had an opportunity to participate. The advice to government was that the most cost-effective bid was from a consortium of Tenix and Toll. It was an independent advisory body, I might say for the benefit of Senator Evans, that gave that advice to government, and government accepted that advice. Obviously, I do not know the detail of knowledge that Mr Reith might have had when he was minister. I was obviously not the minister and that is why I say to some extent in these things it is necessary to rely on the integrity of individuals. But in the case of Mr Reith, I am very confident that I can rely on that integrity and I would advise Senator Evans that he can as well.

Senator CHRIS EVANS —Mr President, I ask a supplementary question. Given the minister's confidence in the integrity of both Mr Reith and the tender process, can the minister confirm that the claimed 30 per cent savings that prompted this privatisation or outsourcing of DIDS will be realised? Further, does the minister have full confidence in the Tenix-Toll bid meeting the full requirements of the tender?

Senator HILL (Minister for Defence) —Through the process, and the reforms that have been engendered through the process, significant savings have already been achieved and further savings are expected to be achieved. That is why we entered into the DIDS process, because obviously on this side of the chamber we are interested in cost efficiencies, which is more than we can say for the Australian Labor Party, which of course ran up huge deficits and huge debts. We have a different way of doing business on this side of the chamber. So we have continued with the DIDS process because it is in the best interests of the taxpayer and will lead—

Senator Chris Evans —And don't worry about the cost!

Senator HILL —No, it is a cost-saving measure. Significant savings have already been achieved and further savings will be achieved. This government is interested in efficiency in government—cost efficiency— and we are very pleased to see that in the terms of balanced budgets. (Time expired)