Mark Vaile (Lyne, National Party, Minister for Trade) Share this | Hansard source

In responding to this MPI, I would like to make a couple of points right at the outset with regard to the allegations that are being raised by the Australian Labor Party over this issue: firstly, the allegation that the government did absolutely nothing insofar as the so-called warning bells are concerned; and, secondly, that Australian money has gone to fund weapons and suicide bombers. There is no evidence at all that Australian money has gone to fund suicide bombers, and we absolutely refute the allegation. With regard to the allegation about what the government did and did not do, there has been no evidence produced that government officials knew about or were complicit in the payment of kickbacks to Saddam’s regime. The government has established the Cole inquiry. I know that the Labor Party has dismissed the fact that we have established a commission of inquiry with wide-ranging powers. It was clearly and publicly stated last Friday by Commissioner Cole himself that it was adequate for him to investigate the entire matter. He asked for an expansion of the terms of reference to look at the Tigris issue, and that is going to be forthcoming. Of the 66 countries which had companies providing products through the oil for food program, as the Minister for Foreign Affairs indicated today, only Australia—and the Australian government—is having a full, open and public inquiry into the actions of the Australian companies that were involved in the oil for food program.

I will now go to some of the issues that have consistently been raised by the member for Griffith in this MPI, in his public comments and in his questions during question time. Firstly, the allegations of 2000 were without any substantiation—no evidence was provided in that regard—and the responses given were to the satisfaction of the UN. We continue to go back to the point—not accepted by the Labor Party—that these contractual arrangements were overseen and dispensed with by the UN under the provisions of the 661 sanctions committee, that they controlled the escrow account and that they approved the contract. We could not issue export permits until they were approved—and that approval indicated that those contracts cleared the sanctions issues.

Further allegations were raised in 2003 by a commercial competitor, US Wheat Associates, and those allegations were made public. On both occasions, AWB, which at that time had an outstanding reputation as a corporate operator both in Australia and internationally—and nobody can dispute the fact of AWB’s reputation at the time—strenuously denied those claims. That information was gained and dealt with. Again, the UN Security Council sanctions committee continued to approve the contracts put before them for the sale of wheat to Iraq. So on those two occasions, if there had been enough evidence of wrongdoing, the UN would not have approved those contracts and they would not have paid the money out of the escrow account.

While I am on this subject, there are a lot of urban myths floating around on this issue which I want to take this opportunity to debunk. The public comment on the UN oil for food program in the aftermath of the Volcker report and the Cole inquiry has often been inaccurate and misleading. There has been a concerted effort to attack the government on the basis of so-called facts—and they are not facts. There is a range of false and often-repeated assertions about the government’s role in and knowledge about problems in the oil for food program which have assumed the status of articles of faith. They are basically urban myths. The first urban myth is that the terms of reference are too narrow to investigate the government’s role in the oil for food program. The government took the proper and appropriate step of establishing the Cole commission of inquiry to examine the activities of three Australian companies about which concerns were expressed in the report by the UN’s independent inquiry on the oil for food program. The terms of reference for the inquiry were entirely appropriate given the nature of the UN inquiry report’s findings.

As Commissioner Cole and his counsel have highlighted, DFAT’s role in the oil for food program is being examined by the inquiry. DFAT staff have been interviewed and relevant documents have been examined by the inquiry. Full cooperation is being provided to the inquiry. On 3 February, Commissioner Cole said in a statement that the inquiry will address and make findings on the role of DFAT, including DFAT’s knowledge about contracts, what AWB told DFAT about wheat contracts and what DFAT knew about Alia. Commissioner Cole also said that if there was any breach of law by the Commonwealth or any officer of the Commonwealth, he would recommend widening the terms of reference. He has made a public and independent statement about his ability to investigate fully this whole issue. So much, then, for the claim that the terms of reference are too narrow. Commissioner Cole last week asked for an expansion of the terms of reference with regard to one aspect of the operations of AWB. He said quite clearly—and I state it again—that, if there was any breach of law by the Commonwealth or any officer of the Commonwealth, he would recommend widening the terms of reference. I think that point has not been reached yet. So there is a full investigation taking place.

The next myth being peddled, particularly by the Labor Party, is that the government was aware that AWB was paying kickbacks to the Saddam Hussein regime. At no stage during the oil for food program did the Australian government have evidence to suggest that the AWB or other Australian companies paid kickbacks. Of concern are the repeated efforts by some to infer that DFAT officials were implicit in sanctions rorting. This is an outrageous allegation. A case in point was the inquiry’s examination of advice provided to the AWB on methods to repay damages arising from wheat contamination in 2002. DFAT provided advice to AWB, which the inquiry’s counsel found was appropriate and proper. This advice was faithfully reflected in an internal AWB email. However, one commentator chose to infer that there must have been some deeper conspiracy, apparently saying he wanted to see additional information on the issue before he would exonerate the DFAT staff involved. This case is also interesting in that it shows clearly that the inquiry is examining the role of DFAT and the actions of DFAT staff, whose advice was found to be appropriate and proper.

So can I say again that, out of the 66-odd countries who had companies operating within the oil for food program, we in Australia have established the most transparent and publicly open inquiry, to get to the bottom of the facts of the operations of three companies within the oil for food program. That has been acknowledged in the United States. There was a question in the House yesterday about Senator Coleman. Senator Coleman has publicly acknowledged and welcomed the move by the Australian government to establish this inquiry so that the facts can be uncovered and brought into public awareness.

The next myth that is being peddled around relates to the involvement of DFAT—or DFAT allegedly approving AWB contracts. DFAT did not approve AWB contracts. That was the role of the UN. The United Nations was running the oil for food program. If you read the transcripts, the evidence and the conclusions of the Volcker inquiry, Volcker highlighted exactly the same point. Volcker also highlighted the point that the UN engaged Customs officials to check the veracity of those contracts and to check the price and the value of what was being traded. So the UN’s 661 sanctions committee and the UN Office of the Iraq Program were responsible for contract approvals. Again I say this fact was highlighted by the Volcker report, the report that preceded what we are doing in Australia as far as the Cole inquiry is concerned. The Office of the Iraq Program was established to manage the oil for food program contract approval process. DFAT or the Australian government could not approve a contract for AWB to send products into Iraq. It had to go through the UN. It was being paid for out of the escrow account established under that section 661 committee. That is where the payment came from. That is where the arrangements were made. That is where the approval went through. The UN therefore ran the oil for food program and employed Customs experts, as I indicated a second ago, to examine and approve the contracts. It was not DFAT but the UN that approved the contracts—it was not DFAT.

The next urban myth that is being peddled around, with just enough information being left to trail the bait, if you like, is that DFAT approved AWB’s use of Alia. DFAT did not approve AWB’s use of Alia, despite any claims to the contrary. AWB’s use of Alia was not in AWB contracts, as Volcker and Cole have highlighted already. AWB never advised the UN it was making payments to Alia for inland transport. It is also important to note that the AWB had apparently been using Alia for around a year prior to its 30 October 2000 letter to DFAT in which AWB made a general inquiry about using Jordanian trucking companies. This letter did not mention Alia. DFAT has no record of ever being asked by AWB to conduct due diligence of Alia or to approve its use of Alia. The department made this very clear in the statement it issued yesterday—and, obviously, in what has been submitted to the Cole inquiry. We are aware that there will be further evidence given in this regard to the Cole inquiry. It is very important to note that because I know that there are other views being expressed on this—and also there are allegations and insinuations being left out there on this matter by the Australian Labor Party.

The next urban myth is that DFAT staff travelled with AWB to Iraq in August 2002—again totally untrue. Despite repeated claims in the media, DFAT has no record of any DFAT staff ever travelling with AWB to Iraq, from the start of the oil for food program in December of 1996 until the end of Saddam Hussein’s regime. It is a good opportunity to get some of those details on the record. Some of them have already been put on the public record as part of the evidence that has been delivered to the Cole commission of inquiry. They are the facts with regard to the involvement of the Department of Foreign Affairs and Trade in terms of discharging their responsibilities.

In the time remaining can I just reiterate some of the history here. Australian wheat growers—and I said this in the House yesterday—are of prime concern and interest to the government. Wheat is one of our major export industries.

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