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Thursday, 5 February 2009
Page: 410


Senator RONALDSON (11:11 AM) —I appreciate the opportunity to speak to this bill this morning prior to the rest of the debate. I will confine my comments to enable that debate to proceed as quickly as possible. The coalition supports the Auditor-General Amendment Bill 2008 [2009]. It basically comes out of recommendations of the Joint Standing Committee of Public Accounts and Audit in, I think, 2001. The government of the day had some minor concerns and these have been addressed and are reflected in the current bill. We obviously support the role of the Auditor-General. It is extremely important in the context of proper scrutiny of the activities of government. This bill will enable that scrutiny to be further enhanced. I note that there was, in Audit Report No. 19, released by the Auditor-General yesterday, scrutiny of the CMAX Communications contract for the 2020 Summit and the activities of the Department of the Prime Minister and Cabinet. If you look at that report, it indeed reflects the importance of the role of the Auditor-General and the requirement that we provide the Auditor-General with the requisite powers to address government and government activities. I also note with interest that the spin of the government last night in relation to this report on CMAX Communications and the activities of the staff of the Department of the Prime Minister and Cabinet, involving a senior member of Minister Fitzgibbon’s office, was that this report cleared those activities. As honourable senators know


Senator Mark Bishop interjecting—


Senator RONALDSON —I suspect you protesteth too much, my friend, because I have been talking about this for only about 10 seconds and you are already starting to plead the case. I will make the suggestion to Senator Bishop, Mr Acting Deputy President, that, as much as I do like him and respect him, perhaps he should read the report first and then give some commentary on it. When I am finished I am happy to send it over so he can flick through it. For his benefit I have highlighted some parts of the report so that he can refer to them as well, which I think is in the nature of the spirit of cooperation of this chamber.

The interesting part is that the spin was that there was no undue influence coming out of the Prime Minister’s office in relation to the awarding of a non-tendered contract for the 2020 Summit to a company owned at the time by a senior member of the office of the Minister for Defence, Mr Fitzgibbon. For those who might not have been following this, and it is hard to believe that anyone would not have followed this appalling act of a lack of transparency—so for those who might not have, those who have been away for some time; for about 12 months they would have had to have been if they had missed this—the Minister for Defence’s senior media adviser owned a company called CMAX Communications and CMAX Communications was providing work to the Australian government. So you have a senior member of a senior minister’s office running a company that was taking contracts and taking taxpayers’ funds at the same time as he was operating his job.

This is again for those who have been away for 12 months and are not aware of this appalling lack of transparency. How did CMAX Communications get the job? Through a tender process? No. Through an open tender process? No. Indeed, Prime Minister and Cabinet were recommended to use CMAX Communications by a senior adviser in the Prime Minister’s office. The government put out their spin yesterday about there being no undue pressure. Well, what is the definition of ‘undue pressure’? The senior adviser in charge of the 2020 Summit brings in Prime Minister and Cabinet and says, ‘You might like to consider CMAX Communications for the media role in the 2020 Summit.’ Take the mere fact that that company was recommended, given the relationships between the senior advisers in the Prime Minister’s office and the senior adviser in the Minister for Defence’s office. That mere recommendation was itself undue pressure. So you have got PM&C coming in and you have got the senior adviser saying, ‘Oh, you might like to consider CMAX Communications for this job.’ So what? Does PM&C go away and say, ‘Oh, well, no; we’re not prepared to accept that’—particularly when the senior adviser has probably said, ‘You know the urgency of this contract, don’t you?’ So how do you think PM&C might have responded to that? I might be terribly wrong but I just reckon they might have taken that as a very non-negotiable, subtle hint that CMAX Communications perhaps should get that contract. As further evidence of that, I will turn to page 14 of the report and I will read out paragraph 17:

The basis on which the PM&C delegate made the decision that engaging CMAX Communications represented value for money was not clear from the departmental record that had been made. In particular, PM&C’s documentation did not accurately record the way in which CMAX Communications was identified to it as a possible provider, or the inquiries it undertook to satisfy itself that engaging CMAX Communications represented value for money.

Well, Senator Bishop, game, set and match, my friend, because the departmental records did not in any way refer to that, because the departmental records could not refer to that without giving the game away as to who made the recommendation. Of course the records were not there because they were not prepared to put in writing where the recommendation came from. So not only have you—the government and the Prime Minister’s office in particular—compromised due process and compromised transparency; you have also compromised Prime Minister and Cabinet, the very body that should be providing free and uninhibited advice to the Prime Minister’s office. In the way that you have handled this, you have effectively nobbled them and compromised them severely. For that you should accept great responsibility and you should acknowledge blame.

I give the government due credit for their spin last night in relation to this. It was a masterful piece of political spin from a government that has just about got this 24-hour spin cycle down pat. I will give them their due credit: they are very good at spinning. In fact, I think this government are the masters of spin. They are indeed the masters of spin. But what we did find out from the Auditor-General’s report, which we could not find out from a couple of Senate estimates hearings and a number of other hearings, was this. We finally got confirmation that the recommendation for CMAX Communications was from the senior adviser. Why all the prevarication? Why go through two lots of Senate estimates? Why were you hiding that fact? I will tell you why the Labor Party were hiding it: they knew it did not pass the sniff test. This did not pass the political sniff test. It is another example of the gross arrogance of this government that you thought you could get away with it. You thought you could give a contract to a Labor mate and get away with it. It does not pass the sniff test and you have been caught out. It does not matter what spin you put on this; it just does not look right and you should acknowledge that.

The report went on to refer to a report to this marvellously independent group—the height of independence, the height of transparency!—affectionately known as the Government Staffing Committee! Of course, the Government Staffing Committee is made up of senior cabinet ministers. They were looking into the activities of a senior employee of another one of their fellow cabinet ministers. I am sure that the public would believe they were certainly going to have an open and transparent view of that! What they said was:

... that there was no evidence found of any involvement on the Defence Minister’s Adviser’s part of any influence exerted by him ...

That was never the issue. The Government Staffing Committee was looking at an issue that was not there because the Government Staffing Committee did not want to look at the real issue. What a lot of nonsense. This was never the allegation. The activities of the senior adviser in the Minister for Defence’s office was never the cause for concern. That was not the issue. The issue was the level of influence out of the Prime Minister’s office from a senior adviser giving taxpayers’ money to a government mate, to a personal mate, to the employee of a cabinet minister. That was the issue; it was nothing to do with what Mr Taubenschlag was or was not doing. But we got a rare admission, which I presume was pulled from them kicking and screaming. Even this outrageous group, the Government Staffing Committee, who should never, ever have been looking at this matter, actually noted in the report:

... that there was the possibility of an appearance of conflict of interest ...

There most certainly was. What a gross understatement. Indeed, evidence taken under oath by ANAO supported those conclusions.

There are a number of other matters in here which I think are cause for concern. What we found from this report was not the spin the government put on. If you look behind the report you can see what really happened on this occasion. There were, as the ANAO observed—and I refer to the report:

... a number of shortcomings with PM&C’s contract management. In particular, the contract document did not specify the name of the individual that was to deliver the contract services; and the total amount paid to CMAX Communications ($56 358 plus GST) exceeded the maximum amount specified in the contract ($52 000 plus GST),—

I can see Senator Bishop looking at me and I will get this across so he can have a look at it himself—

and there is no evidence that this issue was identified by PM&C prior to the payment being made.

So we have this cloak of secrecy surrounding the CMAX Communications contract. The government will say: ‘Oh, look, it’s only $60,000. What’s all the fuss about over $60,000?’ I don’t think it matters whether it is $6 or $6 million, quite frankly. It is the principle of this issue which is at stake. Do not think that the Auditor-General’s report in any way clears the government. I am glad that the Special Minister of State has now come in; his staff have obviously alerted him to the debate and I am pleased to see him.

If you look at the principle of this, it is not about $6 or $6 million; it is actually about the appropriateness or otherwise of a senior adviser in the Prime Minister’s office recommending one person only to Prime Minister and Cabinet for a $60,000 effective contract. That is why, as I said earlier on, this report does not exonerate the government. This does not exonerate the activities of the Government Staffing Committee. It does not exonerate the people involved in this. What it does show quite clearly is that the openness and transparency upon which this government said it would act if elected is not there. It is not there. This was not open; it was not transparent. That has been shown by the Auditor-General’s report, despite the marvellous spin of the government last night in relation to this. The Labor Party has compromised Prime Minister and Cabinet and has completely compromised the principles upon which it was allegedly elected.