Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

In answer to a question from the member for Corio on 10 November 2005, (Hansard, page 104) on the subject of the oil for food program, I referred to advice provided by Mr Tim Besley, Chairman of the Wheat Export Authority, to the Senate Rural and Regional Affairs and Transport Committee of 1 November 2005. Mr Besley has since written to the Chairman of the Committee, indicating that his answer was ‘factually incomplete’ and provided additional information.

The letter is reproduced below to supplement the answer of 10 November 2005.

7 February 2006

Senator Bill Heffernan

Chairman

Senate Rural and Regional Affairs and

Transport Committee

Department of the Senate

Parliament House

Canberra ACT 2600

Dear Senator Heffernan

At the Committee Additional Estimates hearings on 1 November 2005 and in the context of a discussion around the Wheat Export Authority’s (WEA) review of AWB(I) contracts I was asked the following question by Senator Siewert:

“were you aware that the AWB had entered into commercial arrangements with the Jordanian trucking company?”

To which at the time I replied “No”.

And subsequently in the context of the same question I replied:

“there was no indication of it at all on the documents we saw”.

Having considered my responses to the committee I have since conducted a further review and I would like to inform the committee that my answer was factually incomplete. The WEA was made aware in mid 2004 from material in its possession that AWB(I) was supplying wheat into Iraq under an arrangement that included over land transport by a Jordanian trucking company.

Consistent with its function of reporting on the outcomes of the export performance of the national pool and in response to public allegations of AWB(I)/AWB Ltd paying “kick backs” in Iraq the WEA undertook to address the issue in its 2004 performance monitoring activities,

AWB(I) provided WEA access to a sample of 17 contracts for wheat sales to Iraq under the UN oil for food program. WEA staff reviewed these contracts to verify whether the pool FOB data provided to WEA was consistent with those contracts. The details of the contracts were consistent with data provided by AWB(I) to WEA.

When questioned specifically by WEA staff over the provision of “kickbacks” in Iraq AWB(I) denied any wrong. AWB(I) staff pointed to the unique circumstances of Iraq sales (eg: that sales were to include delivery of wheat over land and payment is not made until the wheat is delivered) to explain why it was necessary to pay a Jordanian trucking company and why prices may appear above global benchmarks.

Part of the WEA’s 2004 performance monitoring activity included examination of the Corporate Governance procedures within AWB(I) including a review of the AWB(I) Corporate Code of Ethics and Code of Conduct Policy that had been approved by its Board. This policy dealt with agency facilitation payments. WEA’s review found that there were no payments recorded for Iraq wheat sales.

WEA’s performance monitoring activities are undertaken from the perspective that WEA is not a regulator of AWB(I)’s performance. Responsibility for the manner in which AWB(I) conducts its business resides with the Board which is governed by a constitution and established corporate governance framework.

The WEA’s role is to report retrospectively on the outcomes of AWB(I)’s management of the national pool and the resulting benefits to growers. This is generally a high level assessment undertaken by WEA on an annual basis.

I regret that my answer was not complete.

Yours sincerely

MA (Tim) Besley

Chairman

08/02/2006 161Wednesday, 8 February 2006

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The DEPUTY SPEAKER (Hon. IR Causley) took the chair at 9.30 am.