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Thursday, 11 June 1970

Mr DALY (Grayndler) - I wish to say a few words to support the amendment that has been discussed, and to oppose the amendment that has been moved by the Minister. What people do not realise or what the Government refuses to realise is that the real mystery men on the Australian business scene are the directors of the health and medical' benefit organisations. There is no method of election, and no-one knows their background. We do not know whether they are appointed on their ability or by virtue of their contacts or whether or not they are appointed as a result of services rendered to the person in control of the fund. In this Parliament I have mentioned the case of Mr Huxley, who is now serving 20 years hard labour as a result of a $5.5m fraud to which he pleaded guilty. He was appointed to the Hospital Contributions Fund in NSW because he nominated the director of that fund - Mr Turner - as a member of the Art Gallery Society of NSW. Why should we not know if this is the method of electing directors, where these funds have been invested, and also the association these people have with the organisations?

Dr Forbes - He was the representative of the Lewisham Hospital! as I have told you repeatedly on notice.

Mr DALY - I am not concerned about that.

Dr Forbes - He was the representative of the Lewisham Hospital.

Mr DALY - Mr Turner knows I made this allegation.

Dr Forbes - Tell us what you know about the Lewisham Hospital.

Mr DALY - I made this allegation, and Mr Turner has never written to me denying it, has never asked me to withdraw it, and has never objected to it. I think his silence exemplifies his guilt and the reason why that man was appointed. That brings me to the point where I ask why we should not have known, for instance, Huxley's association with the organisation. Why should we not know what every director is associated with? The very fact that this matter has been sent back to this place twice by another place proves, as the honourable member for Hughes (Mr Les Johnson) said a moment ago, that it should be carried in this place.

Dr Klugman - On the voices.

Mr DALY - On the voices. When all is said and done, there are a lot of fair weather fighters on the Government side - the rebels.

The DEPUTY CHAIRMAN (Mr Drury) - Order! I suggest to the honourable member for Grayndler that he confine his remarks to the clause before the Committee.

Mr DALY - I am doing so. 1 have mentioned that this has been sent back twice from another place, and those who voted twice for it to come back to this House are fair weather rebels from your Party, Mr Deputy Chairman, who apparently send things back only when they realise that something should be done in the public interest and they try to escape their responsibilities. Why is the Minister always covering up for these directors? The amendment he has moved excludes completely what we want to insert, namely, details of direct or indirect interests in shareholdings held by directors of the fund in organisations in which the fund's reserves have been invested be made known. What if H. G. Palmer of other days had been a director? Why should we not have known whether a man like that intended to invest these funds in his organisation that went haywire and lost millions? I cast no reflection on those directors of funds who have integrity, but nobody knows who is a Huxley and who is not because nobody knows them, nobody knows how they are elected, yet we are supposed to give them an open book so far as the investment of huge amounts of funds is concerned.

Mr Hayden - The Prime Minister would not let them hold shares in Comalco.

Mr DALY - The Prime Minister (Mr Gorton) as you know, Mr Deputy Chairman, would not let his Ministers hold shares in Comalco, and quite rightly. That displays integrity of a high order. Why should we not expect the same from directors of organisations I ke this? As the honourable member for Robertson (Mr Cohen) has said, they are faceless men. They are friends of people many of whom are very wealthy and powerful people with great connections in business.

The DEPUTY CHAIRMAN (Mr Drury) - Order! I think the honourable member is getting rather wide of the point.

Mr Hayden - No fear. This is the crucial point of this amendment.

Mr DALY - If I might answer your point, Mr Deputy Chairman, I would ask you to read the amendment to clause 27 which I am discussing. It reads in pari as follows:

Clause 27, page 19, line 23, proposed section 76a, sub-section (2.), omit paragraph (b), insert the following paragraphs -

Listen closely to this, Mr Deputy Chairman -

(i)   details of how the reserve fund has been invested;

(j)   details of direct or indirect interests in share holdings held by directors of the fund in organisations in which the fund's reserves have been invested.

The point I make with due deference to you, Mr Deputy Chairman, is that we believe that the business connections of directors of these funds in the business world should be known. 1 have mentioned cases. It was Huxley in one but it could have been H. G. Palmer. It might be Comalco or any other organisation. Why should we not know their affiliations in order to determine where these moneys are being invested? This is a logical argument. It is relevant to the clause and terribly important to the Australian people. I cannot imagine why the Minister has always covered up for the funds. A committee in another place has revealed that they have been fleecing the public and $35m has to be given back to the contributors. The people responsible for this are the directors and we want to know the ramifications of their business interests. It is terribly important. After all, for ail we know Huxley could have been operating their account with the Rural Bank. But probably nobody knew that he was a director of that organisation at that time. Nothing in this legislation is more important than to know the background of the directors, where they invest their moneys, whether they are associated with the funds, whether there are interlocking directorates and whether everything is above board. I know that the Minister is a man of integrity and I believe that the last thing he would want to do would be to take out this amendment which has been sent back twice from another place. That in itself is clear proof of the substance of the clause.

Mr Les Johnson (HUGHES, NEW SOUTH WALES) - It rarely happens.

Mr DALY - It has rarely happened. The other place has gone under in nearly everything else that mattered but it has insisted on this amendment because 7 members of the Liberal Party in that House believe that there should be some control over the activities of these people and that the public is entitled to know their ramifications. If the Minister at the table was adjudicating on contracts and other matters relating to his Department he would not for a minute be tied up in companies with which he was negotiating. It would not be within his principles to do it nor would it be within the principles of any member of the Ministry for that matter. But here we are allowing a director of this fund to be a director of a fund and to invest its money in organisations with which he is associated. At the same time we are giving him a protection, a safeguard and a right that is denied every other reputable member of the community associated with the handling of public funds. For some reason or other the Government is covering up. I suppose - I just make passing reference to this - that maybe some funds went into the Government's coffers for its election campaign.

The DEPUTY CHAIRMAN (Mr Drury) - Order! I ask the honourable member to confine his remarks to the clause before the Committee.

Mr DALY - I was only making passing reference, Mr Deputy Chairman. I can appreciate your sensitivity on that point.

The DEPUTY CHAIRMAN (Mr Drury) - Order! Is the honourable member making a reflection on the Chair?

Mr DALY - Certainly not. Not for a minute would 1 do that with you, Mr Deputy Chairman. 1 believe that the Government has a responsibility to endorse this amendment. The very fact that this particular section has been taken out in its entirety proves that pressure has been exerted from some source or other to protect the faceless men of the business or medical world, namely, the directors of these organisations. We are not asking for much. If the directors were elected by a vote of the people concerned and if we knew who they were, we would probably know their qualifications for the job and the ramifications of their investments before they stood for election. But we are asked to accept a blank cheque. The Hospitals Contribution Fund comes along with twenty or thirty directors picked out of a hat for services rendered. Nobody knows who they are or what they are. They might be brainy; they might be silly; they might be bright; they might be anything. We are not told anything about them and, although millions of dollars are being invested, the Government refuses to write into legislation this amendment as a safeguard for the public and for contributors' funds. I can see no justifiable reason for this amendment not being adopted and, like honourable members on this side of the chamber, I will be interested to hear the Minister make an explanation in regard to it.

For once - far be it for me to do it too often - I commend those limited rebels of the Liberal Party in another place who sent this amendment back twice because for once they have cast an intelligent vote in the interests of the people to see that the people are protected. Therefore I ask that the House adopt the amendment that has been moved and reject the amendment moved by the Minister because I think that integrity, public interest and contributors' interests demand that this amendment be inserted in order to protect their finances, their funds and the reputation of all associated with them.

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