Kelvin Thomson (Wills, Australian Labor Party, Shadow Minister for Public Accountability and Human Services) Share this | Link to this | Hansard source

Who benefits from the sale of Telstra? Certainly it is not the taxpayers who used to own Telstra but now have to put their hands in their pockets if they wish to keep any of that ownership. Certainly it is not the consumers who face the prospect of higher fees and charges and reduced services. One group of people who do benefit are stockbrokers. The Howard government has decided to offer them $37 million of taxpayers’ money in brokers commissions—$37 million in retail stockbroker selling commissions or 1.25 per cent of the total amount for each T3 share. These are some of the most generous commissions seen in the Australian market this year and 2½ times the amount paid to brokers in the T2 share offer in 1999. Presumably, it is going to be twice as hard to sell shares in T3 as it was in T2. We will now have zealous stockbrokers pushing T3 shares on Australian investors because of the massive commission they will receive.

Who else benefits? There would be the advertising agencies. The government spent $12.4 million promoting the first tranche of the sale of Telstra. It spent $13.1 million promoting the second tranche of the sale of Telstra. And now it is out there at it again, kissing goodbye to $20 million of taxpayers’ money to sell the rest of Telstra. This is saturation advertising from a government that has spent $1 billion on government advertising since it came to office—on Work Choices, GST, Medicare and all the rest of them—and which plans to spend another $250 million on advertising before the next election.

Who gets this money? If we look at the newly released government contracts we find that George Patterson Young and Rubicam entered a $1,870,950 contract on 1 May this year for ‘advertising agency services for the Telstra sale’. That day, 1 May, was my birthday and it looks like it was George Patterson’s as well—$1.87 million! It is worth noting that back in 2003 George Patterson was awarded a $10-million-a-year contract by senior Telstra executives. That money was not money for ad placements. Patterson was not hired to create any media advertising for Telstra. The contract stipulated they could not produce ads until after 30 June 2004. It was just money directly to Patterson. They must have thought all their birthdays had come at once. The fact that Patterson was appointed without a competitive tender outraged the advertising industry. One agency executive was quoted as asking, ‘Can you think of another example in the history of advertising of someone awarding a finite income figure for years without any specifications of workload for which that $10 million can be paid?’ It was a rort, a chop-out to help Alex Hamill, the executive chairman of George Patterson Partners’ parent company, the Communications Group.

It is also worth noting that Alex Hamill had taken over George Patterson from Geoff Cousins. Geoff Cousins was Chief Executive of George Patterson Australia from 1983 to 1987 and chairman of the company from 1984 to 1992. You guessed it: this is the same Geoff Cousins who was responsible for running Liberal Party election campaigns such as the federal campaign in 1990. This is the same Geoff Cousins whom the Prime Minister has decided has to be on the Telstra board. We have a Prime Minister who now believes he can get away with forcing one of his mates onto the Telstra board and at the same time have this mate’s former company run the Telstra advertising account. It is said that you can choose your friends but you cannot choose your relatives. In the case of the Telstra board, Telstra cannot choose its cousins but the government can choose its mates. Needless to say, George Patterson has made a number of significant donations to the Liberal Party. The Australian Financial Review, reporting on Telstra’s $10 million bailout for George Patterson, said back in 2004:

Despite denials, the mates’ network reigns supreme.

That is still right: the mates’ network still reigns supreme.

We need real transparency and accountability in the awarding of government advertising contracts.  A Labor government would implement the guidelines which were proposed by the Auditor-General after the Unchain My Heart extravaganza of the GST ads, and we would subject ads to the independent scrutiny of the Public Service Commissioner. In the meantime, taxpayers are tonight watching their dollars fly out the window in the Telstra advertising blitz, with the uncomfortable realisation that these ad campaigns are by Liberal Party mates for Liberal Party mates, just like Ted Horton’s Work Choices ad campaign—by Liberal Party mates for Liberal Party mates.