Senate debates

Tuesday, 7 November 2006

Questions without Notice: Take Note of Answers


3:00 pm

Photo of Joe LudwigJoe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | | Hansard source

I move:

That the Senate take note of the answer given by the Minister for Justice and Customs (Senator Ellison) to a question without notice asked by Senator Ray today relating to customs and the importation of goods from Iraq.

I have no intention of jeopardising any ongoing investigation, as Senator Ellison responded, but there are serious process issues that do require an answer.

It is incumbent on this government and it is the duty of this government to ensure that its actions or inactions are fully explained to the public in respect of this matter. At estimates, which allows us to examine these matters, the government’s response was, ‘It’s under the oil for food program and, therefore, public servants are not allowed to respond,’ irrespective of whether it was outside the terms of reference or not. Even if it was not able to be examined by Commissioner Cole, this government’s response was, ‘We won’t answer it because it’s part of the oil for food program.’ It does require an answer. It does require this government to come clean and say what happened, in a broad sense, in terms of process. Otherwise this government is going to be labelled as being truly rotten to the core in this area. It is not only a government that is becoming tired and arrogant but it is a government that is becoming morally and ethically bankrupt over the handling of the AWB oil for food program and the whole of the oil for food program itself.

The Hawke government in 1990 made amendments to several statutory instruments in order to comply with the UN obligations to implement security resolution 661—the resolution condemning Saddam Hussein’s invasion of Kuwait. Those amendments were made to the Customs (Prohibited Exports) Regulations 1958 and the Customs (Prohibited Imports) Regulations 1958. The amendment regulations, prior to repeal, provided a prohibition against the import of goods from Iraq or Kuwait and the exportation of goods from Australia to Iraq or Kuwait without written permission from the minister of foreign affairs and trade. Under these regulations, the minister had the ability to place conditions upon the companies to obtain permission to import commodities to or export commodities from Iraq. Throughout the first Gulf War and immediately prior to the ill-fated adventurism of the Howard government, these sanctions stood as a bulwark against the former Hussein regime.

These prohibitions were enforced by a competent Labor government but, since the Howard government took over in 1996, we find that $300 million in funds were illegally channelled to that regime. That is the AWB scandal that this government has not been fully able to explain. We find that funding of a torturer, the wilful dereliction of this government, is put sideways with it because this government has been unable to separate itself from the issue. It has sent it off to the Cole royal commission, but only in a limited and narrow way. It did not allow the broader issue to be ventilated.

Last week we saw the culmination of that in the Senate when we heard for the first time that the AFP were investigating not one, not two, not three but seven instances of illegal importation of goods subject to an embargo under the UN oil for food program. Not only are there export rorts of the oil for food program but there are now import rorts. The Howard government’s support and beneficence to its comrades in arms, the Hussein government, seems to know no bounds.

Firstly, the international binding sanction regime, as outlined in paragraph 4, provided for the outcome. It required in part that states:

shall prevent their nationals and any persons within their territories ... from remitting any other funds to persons or bodies within Iraq or Kuwait except payments exclusively for strictly medical or humanitarian purposes and, in humanitarian circumstances, foodstuffs.

And the Australian government failed to prevent the corrupt transfer of some $US320 million of aid money from the UN escrow account for non-humanitarian purposes.

The collaboration of AWB is in itself prima facie evidence that the Australian government did not fulfil its obligations. We are now aware of seven other instances of the Howard government failure to act and to enforce laws that are seemingly not in the best interests of the sick former regime. Why did the Howard government not fulfil its obligations? Those matters do require clear answers from this government. (Time expired)

3:05 pm

Photo of Ross LightfootRoss Lightfoot (WA, Liberal Party) Share this | | Hansard source

I am limited in what I believe I can say here this afternoon with respect to the AWB because of the ongoing Cole inquiry or at least the fact that the Cole inquiry determinations have yet to reach this parliament. But what I want to do is rebut some of those things that Senator Ludwig said or inferred. I have seen no evidence—and I have followed the AWB inquiry assiduously over the months that it has been running—that the Howard government is involved. I have seen no evidence that ministers of the Howard government are involved in these allegations. And I remind Senator Ludwig, and perhaps the Senate as well, that there are times when one feels like saying something about the perception or the actuality of rorts that happen from time to time—and in which governments are sometimes involved—but this is not that occasion.

I think the occasion should arise when we can continue to criticise the AWB and those things that happened. I am one of the critics of the AWB, even on the allegations that they have undertaken serious rorts in the Middle East. But I have held my tongue over the past few months and have said practically nothing about it. What I do know is this: there is undoubtedly wide concern about serious money, hundreds of millions of dollars, that was without doubt paid by way of devious means to Saddam Hussein’s regime in Iraq.

Having been to Iraq on several occasions, I know how some of these things work in the Middle East. I am sure other senators here are aware of how one does business in the Middle East. Generally speaking, you do not do business in the Middle East in the way that you do it in the Western world. There are times when—and this in no way an excuse for what AWB has done or is accused of doing—if you want to deal in the Middle East, you conform to that tradition of doing deals the way they have done there for generations. I am not saying that that is acceptable. You can read into that what you like.

What I do know is this: in February 2006 the Minister for Justice and Customs, Senator Ellison, referred material relating to possible breaches of Australian law by certain Australian companies to the Australian Federal Police to investigate. We know that. The referral was made following the matters being raised by the Secretary of the Department of Foreign Affairs and Trade. They are both government arms. This was done in accordance with the guidelines that have been handed down and properly followed for the handling of such referrals. The referral was made to ensure full investigation of material concerning compliance issues which came to the attention of DFAT in the context of the Volcker report—that is, the American report—and the Cole inquiry. This material covered matters not covered by the Volcker or the Cole reports.

As a result of its inquiry, the AFP identified seven companies for investigation. These investigations relate to possible breaches of customs regulations and they are ongoing. A breach of those regulations could attract criminal penalties. While I am aware of speculation regarding the investigation, it is not appropriate for me to state today what I believe. I believe there is some concern otherwise these inquiries would not have been launched by the government. The inquiries were not launched by the opposition. The opposition did not approach the AFP; the government approached the AFP, through the proper channels. This is the proper course to take. Is anyone on the other side suggesting that the government has not followed the correct procedures?

Photo of Joe LudwigJoe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | | Hansard source

Yes, that is exactly what we are saying.

Photo of Ross LightfootRoss Lightfoot (WA, Liberal Party) Share this | | Hansard source

Of course the government has followed the correct procedures.

Photo of Joe LudwigJoe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | | Hansard source

Senator Ludwig interjecting

Photo of John HoggJohn Hogg (Queensland, Deputy-President) Share this | | Hansard source

Order! Senator Ludwig.

Photo of Ross LightfootRoss Lightfoot (WA, Liberal Party) Share this | | Hansard source

You cannot say that truthfully. I have just told you what the procedure was. We have followed due process. The government has followed due process.

Photo of John HoggJohn Hogg (Queensland, Deputy-President) Share this | | Hansard source

Senator Lightfoot, you should address your comments through the chair.

Photo of Ross LightfootRoss Lightfoot (WA, Liberal Party) Share this | | Hansard source

I am saying, Mr Deputy President, that the government has followed due process. How could you possibly say that this government has not followed those rules, which not only this government but also the preceding government set? It would be one thing to accuse the government of doing something like Khemlani did back in the seventies where the government of the day borrowed billions of dollars to try to circumvent parliament and circumvent due process. That is not the case here. (Time expired)

3:10 pm

Photo of Robert RayRobert Ray (Victoria, Australian Labor Party) Share this | | Hansard source

Once again today we have seen a government minister claim that we are asking questions on operational matters when we have asked about matters of process. This pathetic excuse is trotted out. Have we ever had a record on this side of the chamber of asking about operational matters? The answer is never. What we are pursuing is whether government ministers fulfilled their duties as a minister with full diligence. These questions refer to events that occurred six or seven years ago. We are entitled to ask why—when these infractions were known, at least to DFAT and almost certainly to Customs—they were not referred for investigation six or seven years ago. Why did it only happen in February this year as the opposition was sniffing around on the issue? We are entitled to an answer on that, and we have got nothing.

That is nothing compared to what happened at estimates last Thursday. Already we have had evidence from a previous estimates committee that this matter is not before Cole and is outside the terms of reference. So we asked officials at the table for details on this. What answer did we get? ‘Yes, the matter is not before Cole and is not within Cole’s terms of reference; however, the broad subject matter is before Cole—that is, oil exports—therefore we cannot answer any questions.’ What a miserable, invented excuse—primarily given carriage this time by public servants wanting to avoid their duty to answer questions truthfully before an estimates committee. How pathetic we have become when we get to that situation.

This question was raised last Monday with Mr Downer, the foreign minister. He assured everyone that everything was okay. Then six hours later, under the cover of darkness, what did we get? We got a qualifying statement that, yes, certain matters had gone to the Federal Police and are under investigation. There was no explanation given as to why it went six or seven years. The one thing we do know is that BP behaved properly in one sense. When their audit discovered they did not have proper authorisation, they wrote to DFAT seeking retrospective approval. They never got a response. Can you imagine the flap over at the RG Casey Building when this letter arrived—when they found that the foreign minister or his delegate, who should have given written authorisation for the import of this material, had not done so.

It is bad enough that we forked out $290 million to fund this despicable regime of Saddam Hussein; what we do not know is how much they got paid for sending materials to Australia that were not properly authorised. Why was this not sent to Cole? Surely, having referred the extra issues of Tigris Petroleum and BHP to Cole, this matter would have gone to them. But, no, under the cloak of secrecy they slipped it off without announcement to the AFP. Do not send it to Cole where there will be the full glare of publicity on yet another bungle over Iraq by the Australian government. No, do not do that at all. Slide it off to the Federal Police and hope that no-one gets to hear about it. But our shadow minister in the other place, Mr Kelvin Thomson, certainly heard about it and started asking questions. So too did The 7.30 Report. There have been 15 documents identified as being relevant to this in Customs. They were refused disclosure on the basis that it was not in the public interest.

Why is it not in the public interest to expose the incompetence of this government? Why is it not in the public interest for us to know why this matter was sat on for six or seven years? I am not saying that Senator Ellison sat on it for six or seven years; from memory, he has been in the portfolio for four or five years. But who preceded him? It was the great proselyte, the great lecturer, the great moraliser of the Senator, Senate Vanstone. I want to know what role she played back in those days after she was demoted into the position of Minister for Justice and Customs. I want to know why she did not refer it to the Federal Police.

I thought it was bad enough that we paid bribes to Saddam to send stuff over there. Now we find that he has been sending stuff here without proper authorisation. Of course, that was outside the Cole terms of reference and outside the Volcker terms of reference and they thought they could get away with it. But do not come in here today and say that this is an operational matter. We know what parts of it are an operational matter and we know what parts of it are a political matter. (Time expired)

3:16 pm

Photo of Cory BernardiCory Bernardi (SA, Liberal Party) Share this | | Hansard source

I also rise to take note of the answer given by Senator Ellison in question time today. In doing so I understand fully why the Labor opposition may be suffering from a case of the Delta Blues—for the record, that is the name of the horse that won the Melbourne Cup. They are trying to confect some outrage about this government in circumstances where it only followed due and proper procedure once these matters were brought to its attention.

I am very pleased to hear Senator Ray state that he is not blaming Senator Ellison, because Senator Ellison responded entirely appropriately to the information provided to him by the Department of Foreign Affairs and Trade this year on 9 February, received by him on 10 February. It concerned the prospect that companies other than those that were subject to the Cole inquiry had possibly committed offences under Australian law by breaching trade sanctions associated with the United Nations oil for food program. The Department of Foreign Affairs and Trade requested that this matter be referred to the Australian Federal Police for investigation. That was done. Correspondence was forwarded to the Australian Federal Police on Monday, 13 February—the next business day. This, might I say, is a very good turnaround for a matter that is quite significant. The Australian Federal Police acted promptly as well. Just three days later they requested additional material in support of the allegations that were made in the original correspondence. The Department of Foreign Affairs and Trade supplied this additional information, relating to 10 Australian companies that were under suspicion of breaching these guidelines.

All of this is entirely appropriate and all of this, according to the information that I have, is entirely factual. I think we need to stick to the facts. We need to dismiss some of the confected outrage, because this government has been entirely appropriate in following established guidelines when issues of malfeasance are made. I want to stick to the facts of this investigation.

Senator Ray also raised the issue of why these matters were referred to the Australian Federal Police rather than to the Cole inquiry itself. I remind the Senate that the Cole inquiry was established in response to a request from the United Nations Secretary-General, who asked for member states to take action where appropriate against those companies within their jurisdiction that were named in the Volcker report. The matters that have been raised today regarding the investigation into the allegations by these seven companies of inappropriate activity are not related to that request from the Secretary-General. The Australian Federal Police is the appropriate agency to investigate these alleged breaches of Commonwealth law. It has the resources, the powers and the expertise entirely appropriate to undertake such investigations.

The Australian Federal Police have been particularly diligent in following this matter. They have full jurisdiction and they have the powers to investigate these matters appropriately. They are not subject to any limitations as to whom or what they investigate. That includes the government and ministers. This is important for maintaining the accountability of this chamber and of any government. By allowing a full and thorough investigation, sparing no-one, we will ensure that we are going to have an appropriate, considered and accurate report in response to these inquiries.

I understand the Australian Federal Police have advised that their investigations relate directly to companies and that, indeed, no government ministers are under investigation. I think this is important because had it been referred to the Cole inquiry there would have been more allegations and more confected outrage about the limitations on this investigation. Quite simply, we have had a full and thorough investigation that has cleared any minister of any inappropriate behaviour. That is a very important point that we should bear in mind with respect to why it was appropriate that this matter went to the Federal Police. (Time expired)

3:13 pm

Photo of John FaulknerJohn Faulkner (NSW, Australian Labor Party) Share this | | Hansard source

It is all very well for a government senator to stand up, in the hope of getting some cheap publicity, and tell the Senate which horse has won the Melbourne Cup, when frankly what we are debating here is the fact that this government is run like the Geebung Polo Club. What we know about this issue is this. We know that the AFP received a written referral from the Department of Foreign Affairs and Trade dated 23 February 2006 in relation to certain Australian companies and alleged breaches of trade sanctions. We know that the AFP said that these matters related to possible breaches of sanctions imposed under the oil for food program but that fell outside the Cole inquiry’s terms of reference. We know that the allegations related to the import into Australia of goods from Iraq. We know that one of the matters related to oil. We know that during question time on Monday last week Mr Downer initially said he had no reason to believe that the importation of Iraqi oil into Australia breached UN sanctions. We know that later that day he added to his misleading answer and said:

… the Australian Federal Police is investigating a possible breach in relation to one shipment of oil.

On Thursday, the Department of Foreign Affairs and Trade told estimates hearings that they would not answer questions on this as the oil for food program was a matter for the Cole inquiry. However, they also admitted that they had decided not to refer the matter to the Cole inquiry but to the Australian Federal Police. On Thursday last week, when Mr Downer was asked another question in question time in the House about the matter, he referred the House to the non-answers of his own officials in estimates committees.

No-one has answered the key question: why was there such a huge delay between the oil tanker Poul Spirit landing in Fremantle in October 2000, without proper approval, and the referral to the AFP for investigation of these matters only in February this year? We know that BP Australia also wrote to the Department of Foreign Affairs and Trade to request retrospective approval in early 2001. But why did it take five years to finally refer this matter to the Australian Federal Police? We still have no answers as to why these matters were not also referred to the Cole royal commission. After all, its terms of reference were amended and extended on five occasions. Why is the Australian oil for food investigation into AWB open and public, while these seven other Australian oil for food investigations remain secret? Do we even know whether the Cole commission knew about those seven other investigations? Do we know whether the United Nations has been informed about these AFP investigations? I want to know whether the Department of Foreign Affairs and Trade received high-level United Nations’ warnings, or a warning, about sanction-breaking shipments in late 2000. It is crucial information, and we are entitled to an answer. For the first time, how about the Howard government telling Australians and the Australian parliament the truth about the oil for food program? That really would be news.

Question agreed to.