Legislative Assembly for the ACT: 2008 Week 09 Hansard (Thursday, 21 August 2008) . . Page.. 3431 ..
We have also recommended that any newly established territory-owned corporation provide voting shareholders with copies of its policies and procedures. These did not exist in Rhodium until after the chief executive officer.
But primarily we recommended that the Treasurer explain to the Legislative Assembly before the last day of sitting of this Assembly why the ACT government required Rhodium to “take a contract against its best commercial interests without providing it with compensation as set out in the Territory-owned Corporations Act 1990”. (Time expired.)
MR SMYTH (Brindabella) (11.41): Mr Speaker, this is a damning report of the shareholders of Rhodium. The Chief Minister and the Deputy Chief Minister of the ACT have been held to account by the unanimous report of this committee, a report without dissent or without comment against its recommendations.
As you go through the various chapters of this report, it is quite clear that, right from the start, the shareholders neglected their duty. You have to go back to some of the acts and amendments that have been passed in this place unanimously. In 2004 Mr Quinlan moved an amendment to the Territory-owned Corporations Act, and he said:
The government, as owner of the territory-owned corporations and subsidiaries, has a legitimate right to access regular and timely financial and operational information, and other information, in order to review and monitor their performance.
The shareholders must monitor their performance—that is what Mr Quinlan was saying—and they need the information to do it. The only way that you can monitor the performance of a territory-owned corporation is to take an interest in that corporation. Paragraph 4.18 of the unanimous report quotes the Auditor-General as saying:
Audit considers that the uncertainty of Rhodium’s future, and a lack of clear direction from the shareholders, made it difficult for the Board to provide and commit to appropriate long-term business strategies to drive Rhodium in achieving the best outcome for the shareholders.
The shareholders failed. In paragraph 4.20 the Auditor-General tells the committee that there:
… is no legal responsibility for the shareholders to provide input … the shareholders could not stay away from certain involvement … to ensure that the board’s strategic directions reflected the objectives of the government.
The shareholders are the Chief Minister and the Deputy Chief Minister. In paragraph 4.23, when talking about what the Auditor-General says, the report goes on to say:
What the comment does recognise, however, is the influence that shareholders—