Page 3428 - Week 09 - Thursday, 21 August 2008
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who was the previous chair of the public accounts committee. I also want to thank Andrea Cullen, who was the secretary until the middle of last year, and Hamish Finlay, who took over this and a number of other inquiries halfway through on her departure. It is not an easy thing to take up an inquiry when it is halfway through, but Hamish Finlay did that in a commendable fashion. Everyone involved has done a really good job.
Our report is a fair and consensual one. It points out grave failings in Rhodium—which may have been inherited from Totalcare, and we do discuss that. Whilst Rhodium is now perhaps not the major issue—since it is finally getting the direction from government, through the shareholders, that it perhaps should have been given in 2005—the lessons that the committee distilled from the experience are still of value in the government’s dealings with other territory-owned corporations. The other territory-owned corporations are Actew and ACTTAB. It is of interest, and totally appropriate, that they each made submissions to the inquiry.
I am afraid that all the players in this sorry process are condemned in this report to some extent—the management, the board and the shareholders. We began our inquiry in September 2006 and it ends with the tabling of this report in August 2008. The Auditor-General’s report had raised serious issues, and because that report was completed in 2006 a lot of water has gone under the bridge. The issues that the Auditor-General’s report raised are, I believe, well known, by members here at least. They related to governance of the territory-owned corporation; the actions of the chief executive officer; remuneration and other issues related to her employment; credit card usage; sponsorships which were deemed to be excessive, sometimes inappropriate; and a great lavishness in ordering the production of special Rhodium gifts and some very lavish entertainment.
The Auditor-General is not in a position to consider the issues in depth in the way that the committee can. That is why the committee’s inquiry and its report are still very relevant two years later. We should remember that the public accounts committee has representation from both of the major parties in this place and from the Greens, from the crossbench. At one stage, it had the other member of the crossbench on it, though at that stage he was a member of the Liberal Party. Thus we discussed the issues raised robustly and there was a high degree of agreement amongst us.
We received four submissions. They were from the ACT government, Actew, ACTTAB and Professor Roger Wettenhall, who had an academic interest in the issue. We held five public hearings.
I would like to read from the conclusion, because it really sums up our findings. It says, on page 52:
5.1 The unfortunate events at Rhodium Asset Solutions Ltd do not reflect well on any of the participants. Management, led by the former CEO, engaged in ill-advised spending, treated company assets and business as personal benefits and failed to establish policies and practices of even a basic acceptable standard. The Board failed in its duty to supervise management and did not place any priority on addressing key areas where they were aware of weaknesses. The shareholders, while not directly responsible for the day to day failures and questionable behaviour at Rhodium, failed to establish and communicate its expectations to the company.
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