Rachel Siewert (WA, Australian Greens) Share this | Link to this | Hansard source

I move:

That the Senate take note of the answer given by the Minister for Communications, Information Technology and the Arts (Senator Coonan) to a question without notice asked by Senator Siewert today relating to AusAID.

The minister representing the Minister for Foreign Affairs said that she assumes that the minister, Mr Downer, signed off on the AusAID grant of $100 million for the two wheat shipments. AusAID has very stringent approval processes which point very clearly to the fact that the foreign minister, Alexander Downer, would have to have known about this proposal and signed off on a project plan and risk analysis. That means that he signed off on $45 million going to Alia: $45 million that, as I outlined in the Senate earlier today, would have saved 2,471 lives. Either Mr Downer knew about the $45 million for bogus trucking payments or he was not doing his job properly.

As I said, AusAID have very stringent guidelines that they have to follow when looking at funding using AusAID money. AusAID’s job is to provide important aid to people in need. They recognise that this often happens in risky environments, in war zones and in places where there is endemic corruption. So they have in place very clear guidelines and rules that allow them to identify and manage risk. They have very strict procedures for monitoring and accounting for where the dollars go. In Senate estimates last month, despite the fact that cabinet had blocked government officials from answering questions about Iraq, I did manage to ask questions about the actual process. We heard evidence from AusAID experts at the hearings that a very rigorous risk assessment and financial accountability process is in place for all AusAID projects. We heard that AusAID has very clear guidelines under the Financial Management and Accountability Act, which they adhere to ‘to the letter’. For projects of the magnitude of $100 million and of that importance—we were at war with Iraq, do not forget—the minister and possibly also the parliamentary secretary have to approve the projects.

Ms O’Keeffe, a witness from AusAID at the hearings, indicated in estimates that approval of projects larger than $10 million or projects in areas of greater significance—such as those that we are at war with—would automatically go to the minister. We are now talking about a project where $45 million was siphoned off for bogus transport payments. He must act as the financial delegate, under the terms of the Financial Management and Accountability Act 1997. He is bound by the terms of that act, which specify that he has a serious responsibility to take all reasonable steps to ensure the proper expenditure of public money and to provide assurance of risk management and probity. Ms O’Keeffe assured us:

We have very clear guidelines in terms of the FMA, and we certainly follow those to the letter.

AusAID is used to working in areas of high security risk, and has developed very clear protocols to deal with war zones and areas of endemic corruption.

We have heard in the Cole inquiry that the minister and the department had been notified by cables in March 2000 of allegations and kickbacks. They knew how the system worked in Iraq, and where to look, three years before the AusAID bailout of AWB. They had heard these rumours before and they were approving AusAID projects in 2003, but they still managed to approve money to pay for bombs and guns and to rort the system. Forty-five million dollars of AusAID money that should have gone through a very strict probity assessment somehow ended up in the pockets of Saddam Hussein. I cannot understand how the minister did not know this. I cannot understand how, with such an important aid budget, he would not have signed this off or gone into the detail of this process. As I have outlined, there are very strict guidelines in the FMA Act. If the minister did not sign off on this project, who did? Who signed off on a project worth $100 million, where usually a project of $1 million or $10 million would go to the minister? If a project of $100 million did not go to the minister, why not? (Time expired)

Question agreed to.