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Legislative Assembly for the ACT: 2006 Week 9 Hansard (20 September) . . Page.. 2953..


MR SMYTH (continuing):

Rhodium has been facing uncertainty since its establishment due to a lack of clear strategic direction from the Shareholders.

MR SPEAKER: Order! Come to the question.

MR SMYTH: Minister, why did you make it difficult for Rhodium to provide and commit to appropriate long-term strategic planning by your failure to provide clear direction?

MR STANHOPE: Because we gave Rhodium advice that we were considering selling it. It is difficult—in an environment where shareholders had imagined that they would sell a business—for the directors perhaps to commit to long-term plans in relation to that business. Why were we considering selling it? We were considering selling it because of the dysfunction represented in not just its structure but also the structure of all those businesses that we inherited from Totalcare.

It needs to be understood—in the historical context of Rhodium and its associated businesses, that was of course what we inherited from Mr Smyth and his colleagues when we assumed government—that, in the previous three years, that business had accumulated losses of $21 million, not counting as I understand it its venture in relation to the Williamsdale quarry and a range of dysfunctional management arrangements.

If you go to the responses by Bob Samarcq on behalf of the board to the Auditor-General's report you will see the concerns and issues that they faced as a result of the management structures and the culture that were incorporated into Rhodium on its establishment.

It has not been done; it cannot be done. At no stage—anywhere in this report or in any discussion—has the Auditor sought to draw any conclusions around the adverse findings she makes, and the role and the responsibility of the shareholders, even to the extent that neither I nor any other shareholder was interviewed by the Auditor-General; neither I nor any other shareholder was asked to make a submission to the inquiry; neither I nor any other shareholder was given an opportunity to respond to what might, in the view of the Liberal Party, be regarded as an adverse suggestion.

Is it seriously being suggested by Mr Smyth and the Liberal Party that the Auditor-General would make an adverse finding against shareholders without the basic commitment to natural justice or to due process? Is this the allegation: that the Auditor-General has failed in her responsibility; that she would make an adverse finding without asking for a submission, without suggesting that there was an issue that needed to be responded to?

The Auditor-General's comment, I assume—and I can only assume it because it is not explained; it is one line—relates to the decision that the shareholders advised the board of: that they proposed to sell the business. It was in our active consideration. The board was informed of that. I would imagine that, in that circumstance, a lack of long-term strategic direction could be interpreted within the context of a decision to sell the business.


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