AWB knew, should government have twigged?

The admission by AWB Limited, in settling a class action brought by a group of shareholders, that it knew money being paid to transport wheat  to Iraq was being illegally siphoned to Saddam Hussein's government all along, after battling through the Cole Royal Commission claiming innocence, is an appalling comment on the standards of honesty of those involved. And a reminder of the way Cole may have been put on a side track by the Howard Government, and a few other things besides.

Elizabeth Sexton in Fairfax papers quoted John Agius, SC, counsel assisting the Cole inquiry as saying

"he was ''astounded'' by the admission, after seven years of public denials. ''There was no concession coming close to that at any time during the running of the inquiry,'' he said. If there had been, ''the focus would have been on whether or not the United Nations knew about it and whether or not any Australian entity or Australian department or the government knew about it''. There would also have been an opportunity to explore why there was ''so much deception''...Mr Agius said he found no evidence Australian ministers knew about the payments, but if AWB had admitted what it had done, the inquiry could have paid more attention to ''whether [ministers] ought to have known or whether they should have had a different approach to the one which they did have, which was to accept what AWB said when it made its denials''.

The editorial in the Sydney Morning Herald: today says:

John Howard's government set up the Cole inquiry only reluctantly, and then gave it narrow terms of reference: whether Australian companies had broken the law. As such, the government was engaging in another form of deception by default, screening the public from exposure to a fuller picture. In evidence to Cole, Howard and Alexander Downer, his foreign affairs minister, denied any knowledge of kickbacks. Competition for Iraq's lucrative wheat market was intense. The farmers whose wheat AWB sold comprised a core Coalition constituency. Four years before Cole, Howard congratulated AWB for doing "a very good job" in winning Iraq back as a customer after a sales hiatus.AWB's current chairman, Peter Polson, describes last week's settlement as "the final legal matter" against it under the UN oil-for-food program, the issue that brought the kickbacks scandal to light. That may be so for now; AWB settled the case without admitting any breaches of law. But the moral questions left hanging over the company, and the conduct of public officials who turned a blind eye to its activities, are now more burning than ever.

Hear, hear. There is a pending case concerning the former Managing Director and whether he misled the Board but in the light of the admission, hopefully someone is checking the Royal Commission evidence for possible perjuries.

Here are a couple of posts going back to 2006 highlighting what was then apparent about hoodwinking and the "gong" a smarty suggested at the time for Foreign Affairs and Trade officials for being able to "ignore 35 separate indications of wrong doing and report that all's well; to keep an entire cabinet so completely in the dark that they even blink convincingly under a spot light; and to face with equanimity the shredding of its reputation, apparently in order to keep intact the cover of its ministers." In the light of the admission there is also a question about the judgment of some who would claim to be expert at seeing through foreign governments known to be able to spin a tale or two.