Page 3877 - Week 10 - Thursday, 28 August 2008
It was very interesting to hear the Chief Minister last week saying that they did everything in accordance with the Corporations Law, but, in fact, he seems to have overlooked this important element of his own legislation—that is, the Territory-owned Corporations Act, which imposes a higher standard on him and his deputy than is imposed by commonwealth Corporations Law. What we saw last week in relation to Rhodium Asset Solutions was the Chief Minister trying to hide behind cobbled-together legal advice, which, by his own admission, was written by someone who had not actually read the report, and the Hansard record of question time shows that. The sole defence of the Chief Minister and the Deputy Chief Minister was “we have this advice that says that we’re right and everybody else is wrong, written by somebody who hasn’t read the report”. It would also be interesting to know what question it was that was asked that formed the centre of that advice, because the question you ask in relation to legal advice is the key to the advice that you will receive.
In Ms MacDonald’s rearguard attempt to try to cosy up to her Labor colleagues after she had signed up to the unanimous report, she tried to say that there was not “very much bad” in the report about the shareholders. In fact, if you go through the recommendations and the discussion in relation to the recommendations, you will see that there are 10 separate places where the shareholders are the subject of adverse comments. Chapter 4 says that there was uncertainty about the direction coming from the shareholders and that the board did not actually know what the shareholders wanted. After the shareholders asked for a business plan, there was failure to give any feedback on the business plan. That certainly ended up with a situation where we had an organisation which was entirely rudderless. It had no leadership from its principal shareholders, who had very strong obligations under the Territory-owned Corporations Act and also a considerable duty to look after the financial interests of the ACT.
The people of the ACT own Rhodium Asset Solutions, and through the mismanagement of that company, which was overseen by the Chief Minister and the Deputy Chief Minister as the proxy shareholders on behalf of the ACT taxpayers, we have seen the business fall away to nothing. Once upon a time it was a business that was worth in the order of $7 million, and, in the process of trying to sell this business and the mishandling of the selling of the business, there will now be a fire sale to sell off the assets. The ACT taxpayer will be lucky to get a return of perhaps $1 million to $2 million. What we have seen is a falling away of the assets of the Rhodium business under the tutelage of Jon Stanhope and Katy Gallagher.
We have seen a comprehensive failure to look after the fiscal interests of the people of the ACT—the people who pay their salaries. The people who funded Rhodium Asset Solutions have been betrayed by the shareholders, and that is the single biggest message from this situation. The other message is a cautionary one: if these two shareholders have failed in a small enterprise worth less than $10 million—that is, Rhodium Asset Solutions—what of the other enterprises of which they are shareholders? What is happening there? Have they taken their eyes off the ball there as well? We know that they are the shareholders of Actew, and we know there have been considerable difficulties in Actew’s subsidiary, ActewAGL, in relation to the