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Thursday, 9 December 2004
Page: 114

Senator ABETZ (Special Minister of State) (4:19 PM) —The Centenary House scandal, which has continued for well over a decade, is now fully exposed, courtesy of the David Hunt report of the Inquiry into the Centenary House Lease, which was tabled in the other place just a few moments ago. Centenary House is a rort which has now given the Australian Labor Party some $42 million above and beyond normal market rates. At this stage, I must apologise to the Senate, because for a lengthy period of time I have been misleading the chamber by suggesting that it was only a $36 million rort. The royal commissioner has exposed the rort to the extent of $42 million.

Most honourable senators would be aware that this was a lease arrangement entered into by the Australian Labor Party to rent property to the Commonwealth government, which at the time was overseen by the Australian Labor Party. What this royal commission has shown is that Labor's ministerial maladministration conveniently gave the Labor Party a $42 million windfall, which a Labor appointed royal commission just happened not to thoroughly investigate. Indeed, there appears as though there was nearly some sort of invisible hand in the whole deal to allow this convergence of events which gave Labor this $42 million benefit. Allow me to quote from page 173 of the report, where the royal commissioner states:

The very marked impression gained from the proceedings in the 1994 Inquiry—

that is, the Labor Party appointed inquiry—

is that it was in the interests of all parties to demonstrate that the Centenary House lease had been properly negotiated and represented a prudent transaction offering value to the Commonwealth for expenditure. The extent to which there was unanimity between all the parties is strikingly apparent ...

The fix was in in relation to this lease by the Australian Labor Party, and the royal commission exposes a litany of events that gave Labor that $42 million windfall. Indeed, the convergence of convenience was so strong that, if I were a betting man, I reckon that if I had such luck I would only need to buy one Lotto ticket because I would win the jackpot straight off.

In relation to the negotiations, this is what the commissioner found:

There had been no negotiation of the terms of the lease in the commonly understood sense of give and take ... the terms finally agreed had been decided in advance by the Lend Lease representatives of John Curtin House ...

The departmental officer who was put into the position to negotiate had `negligible experience in negotiating leases and was thoroughly out of his depth in relation to this lease'. One wonders why the Minister for Administrative Services at the time, Senator Bolkus, allowed that to occur in his department. The senior minister was Mr Beazley.

It then talks about the party's respective strengths. The commissioner said:

Nor were the needs or wishes of any other Commonwealth agency at that time so great as to require the abandonment of ordinary principles of common sense in the negotiations for the Centenary House lease.

He then found that Mr Collins, the departmental official:

... never understood the strength of the Commonwealth's position or, if he did, he failed to take advantage of that strength.

I wonder why he would not have done that. The commissioner then commented on fixing the starting rent, and this is very interesting. He said:

None of the valuers who gave evidence ... had previously seen a lease in which the starting rent was fixed by reference to the market as it had stood some two-and-three-quarter years before the lease commenced and then escalated by a fixed and predetermined percentage up to that commencement.

His Honour went on:

There was no sensible reason for the Commonwealth to have agreed to the course it followed.

He then went on to describe the 15-year term as `imprudent'. As a good judicial officer, he used very conservative language. On page xvii he said:

When Senator Warwick Parer gave publicity—

Senator ABETZ —If Senator Evans were to be quiet he would listen to this fix. It is a gross embarrassment to his administration and he knows it.

Opposition senators interjecting—

Senator ABETZ —On page xvii it said:

When Senator Warwick Parer gave publicity to the terms of the proposed lease ... Mr Taylor took no action to investigate whether the terms were reasonable, and his failure to do so contributed to the Audit Office's failure ...

Once again there is a convergence of everybody just happening not to follow up as they were required to do. It went on:

Mr Jacobs, having responsibility for the Office's corporate affairs, informed Mr Taylor that inquiries were being made ... as to what was behind the allegations ...

But guess what? Once again very conveniently:

... but Mr Jacobs never became aware of the results of those inquiries.

He said that they were going to inquire but then never bothered to follow up. The report continued:

His failure to follow the matter up also contributed to the Audit Office's failure to act appropriately.

So as we go along we see a picture painted of everybody involved in this—conveniently—not acting properly in the circumstances.

Senator Chris Evans —Is that what the royal commission found?

Senator ABETZ —The royal commission found that Mr Collins was inadequately supervised by his superiors and was not subject to proper controls. Why not? I suggest possibly it was because the fix was in.

Senator Chris Evans —Mr President, I rise on a point of order. Senator Abetz is desperately trying to make something out of the royal commission report that is not included. He is casting aspersions on individuals and on the Australian Labor Party in a desperate attempt to try and make the royal commission report more than it is. I would ask you to call him to order and not let him denigrate and cast aspersions on senators and other members.

The PRESIDENT —Senator Abetz, I will listen carefully to what you have to say.

Senator ABETZ —Mr President, this is just a time-wasting exercise by Senator Evans, who is understandably embarrassed. When Senator Parer first publicised the proposed lease, a ministerial press release was prepared—and guess what it did? It omitted all reference to the escalator clauses that we have condemned year after year. Do you know what the finding of the commissioner was? He said:

There is no logical explanation for this omission ... The omission was neither an oversight nor a mistake.

What does that suggest? It suggests the cover-up; the cover-up was well and truly in. There was an improper $50,000 offer made by the Labor Party's agents Lend Lease. That was made by a Mrs Morris—

Senator Chris Evans —And what was the finding? None!

Senator ABETZ —The offer was therefore improper. That was the finding, Senator Evans, and Mrs Morris knew it.

The PRESIDENT —Senator Evans, you will have your turn in a moment

Senator ABETZ —Mr President, do you know what the Labor Party did for Mrs Morris?

Senator Chris Evans —Apologise and resign! You are a fraud.

Senator ABETZ —After having engaged in this improper conduct, conduct which she herself admits was improper, do you know what Labor did? Mrs Morris was rewarded for her negotiation skills with a string of appointments by a Labor government—Landcom 1996, Sydney Harbour Foreshore Authority 1999—

Senator Chris Evans —Step outside and make those claims!

Senator ABETZ —City West Development Corporation 1995, Energy Australia 1995. You wonder why they would seek to appoint somebody that a royal commission has found—

The PRESIDENT —Order! Senator Evans, that remark was unparliamentary and I would ask you to withdraw.

Senator Chris Evans —I withdraw, Mr President. On a point of order, Mr President, could I draw to your attention that the minister just blackguarded an individual, accusing the person of improper conduct, none of which is a finding of the royal commission report? Is he going to slur everybody who was mentioned or is he going to actually discuss the findings of the royal commissioner?

The PRESIDENT —Senator Abetz has not used any unparliamentary language yet in my opinion.

Senator ABETZ —For the edification and gross embarrassment of Senator Evans, can I refer him to page xxi of the report where His Honour said:

The offer was therefore improper, and Mrs Morris knew it—

It is not me slagging off at Mrs Morris; it is David Hunt QC. And, what is more, Mrs Morris agrees with me! She agrees that it was improper; she told the royal commissioner that. You are now suggesting that my repeating Mrs Morris's own words is somehow defamatory. Senator Evans, I can understand why you were sacked as defence spokesman. What I cannot understand is why the Labor Party made you Leader of the Opposition in the Senate.

The PRESIDENT —Order! Senator Abetz, I ask you to address your remarks through the chair.

Senator ABETZ —The Australian Labor Party has for a very long time sought—

Opposition senators interjecting—

Senator ABETZ —to hide behind the Morling inquiry as the justification for Centenary House. Now, like the emperor with his new clothes, Mr Latham is exposed. The Morling inquiry was nothing but a facade. It provides no support whatsoever to the Labor Party's claims. On page 171 Mr Hunt deals with the significant differences in a number of areas. Time does not allow me to elaborate, but there are one, two, three, four, five, six substantial areas where he disagrees. The Labor Party continually come into this place and say, `Chief executive officers are being paid outrageous sums of money. It might be legal but it is immoral.' Yet today they will get up in this place and say, `We might be legal with the $42 million rip-off of the Australian taxpayer,' but they know it is immoral. All the findings show it is immoral and Labor ought to cough up. (Time expired)