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Legislative Council - Fifty-First Parliament, Third Session (51-3)
2008-11-26 Daily Xml
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GOVERNMENT CONTRACTS, PROBITY

The Hon. R.I. LUCAS (15:53): I rise to speak about probity, or lack of probity, in relation to significant government contracts. In the past two to three weeks I have asked a series of questions, first of the Hon. Mr Holloway and then the Hon. Ms Gago, relating to probity as it concerns the massive $1.4 billion desalination project. In summary, the Hon. Mr Holloway said that there are very strict probity guidelines which relate to PPP projects. He then highlighted that they also apply to big projects such as the $1.4 billion desalination project. In particular, he indicated that no minister should meet with any potential bidder or adviser to a bidder in connection with a PPP-related issue or a significant government contract, nor discuss the project directly or indirectly with any bidder or adviser to a bidder. There is a range of other strict probity guidelines that he said the Crown Solicitor has outlined to all ministers, because ministers are making the final decisions in relation to the government desalination project.

I will cut a long story short. On 22 September Premier Rann announced three successful short-listed bidders for the big desalination project. One of those was Addwater, which comprised two companies, namely, Veolia Water and John Holland. As I indicated to the council yesterday, on 29 August—about a month before cabinet made this decision—minister Gago attended as the featured guest at a major fundraising lunch, organised by Labor's fundraising arm, South Australian Progressive Business, which charged attendees $1,500 a person and raised a significant amount of money for the Labor Party. The host of that function was a company associated with the Veolia group of companies, which was in fact Veolia Environmental Services; and Veolia Water was one of the successful short-listed bidders for the desalinisation project.

When I asked the minister questions in relation to probity, the minister, in the arrogant fashion that, sadly, is customary not only from the minister but also from the whole of the government from the Premier down, said, 'The answer to the question is that I am not in breach of those guidelines.' So, what the minister is in fact saying to this parliament is that the probity guidelines that relate to a major contract like this allow any minister of the government—in particular, minister Gago in this case—during the period when people are bidding for a major contract to go to those companies or companies associated with those companies, raising tens of thousands of dollars—in fact, there is no limit—from those companies whilst minister Gago and her colleagues are waiting to make a decision as to whether or not those companies will be successful in being short-listed for a $1.4 billion project.

That to me is an extraordinary proposition to be putting, as minister Gago has put in this council on behalf of all her colleagues: that the Rann government's probity guidelines allow her, during a process when they are short-listing tenderers for a $1.4 billion project, to in essence go from company to company with the fundraising arm of the Labor Party attending functions as a featured guest or otherwise and raising large amounts of money from those companies whilst they await a decision by minister Gago and her colleagues in the cabinet, in this case just under four weeks after that function.

That is just a disgraceful set of ethics, in my view, for a government and minister in relation to a major contract. Imagine you are a company or tenderer and are approached by minister Gago or Mr Bolkus, her factional colleague, who heads up South Australian Progressive Business, and they say, 'We would like you to conduct a major fundraising function for us, and it just so happens it will be in the period just prior to when the government will make a decision on whether or not you are short-listed as a bidder for a $1.4 billion contract.' What do you do as a company when you are bidding for a contract like that and someone comes through your door? That is the sort of position that minister Gago is saying is acceptable within the probity guidelines of this government. Frankly, if that is the case, not only should she resign but also the Premier should resign if that is the sort of probity that relates to these issues.

Mr President, you ruled me out of order yesterday, but I put the question again to the minister in relation to this contribution: did she advise the probity auditor of that contract that she would be involved in a function raising funds from a company associated with one of the short-listed bidders; yes or no?

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