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, 7 June 1989
Page: 3512

Senator LEWIS(11.06) —I refer not only to the first part of the Minister's answer to proposed new section 51 but also to what he has said in relation to the whole Bill and during the second reading debate. Does this all mean that the Commonwealth would not stand behind this Corporation if it were bankrupted?

Senator Button —Precisely.

Senator LEWIS —I want to make sure that it is properly on the record that the Minister said that the Commonwealth Government would not stand behind this Corporation if it were bankrupted. I mention that because some years ago there was an occasion in Great Britain where a wholly owned subsidiary of the United Kingdom Government went bankrupt, owing millions of pounds to various creditors. The United Kingdom Government failed to stand by that corporation. At the time I thought that was a shameful event because I would have thought that all of its creditors believed that they were dealing with the United Kingdom Government and, as such, they could allow that corporation adequate credit, for the purposes of their business arrangements, without taking the sorts of precautions that they might be tempted to take if they were dealing with what might be called a private corporation-that would include a public corporation. I think it should be publicly known that the Commonwealth Government is saying to the creditors of SMEC, `If this organisation finds itself in a situation where it is unable to meet its liabilities, the Commonwealth Government will not bail it out'. I think most creditors of this organisation, and creditors of any other organisation which is a wholly owned subsidiary of the Commonwealth of Australia, would be surprised to discover that.

The Minister has indicated that I have not made out an argument that this body would be far better owned by the private sector rather than by the Commonwealth of Australia. I refer him to clause 9 of the Bill which states:

The functions of SMEC include investigating, advising on, designing, supervising and constructing, engineering works.

Since when has the Government believed that it ought to be in the business of `investigating, advising on, designing, supervising and constructing, engineering works'? Is that the sort of activity that this Government has been elected to perform, or is it true that this organisation is a hangover from the old Snowy Mountains scheme and the Government has not been able to persuade its Caucus committee that it is about time it got rid of its shares in it?