dfat in iraq for wheat bribes

DFAT in Iraq for wheat bribes
John Kerin
December 07, 2005
SENIOR Australian government officials travelled with AWB employees in Iraq at the time the monopoly wheat exporter was paying tens of millions of dollars in kickbacks to the regime of Saddam Hussein.

And a member of John Howard's cabinet - then agriculture minister Warren Truss - was receiving regular confidential reports on an investigation into the incentives AWB was offering buyers in countries such as Iraq.

AWB, the former Australian Wheat Board, has been accused of paying $US222 million ($290 million) in illegal bribes to the Iraqi government through the UN's corrupt oil-for-food program.

The Australian has confirmed senior Trade and Foreign Affairs officials travelled with AWB staff on missions to secure wheat sales in Iraq. The officials were also involved in helping facilitate negotiations between AWB and Iraqi government contacts.

Labor foreign affairs spokesman Kevin Rudd yesterday asked Trade Minister Mark Vaile in parliament whether Australian officials accompanied AWB staff on their missions into Iraq to negotiate with Saddam's regime.

Before Mr Vaile could answer, the Prime Minister interjected, saying "Yes", although the comment did not appear on the official Hansard record of proceedings.

Mr Rudd last night said Mr Howard's answer had "let the cat out of the bag", revealing the Government was much closer to AWB's negotiations than it had previously admitted. Mr Vaile, also the Deputy Prime Minister, did not reject the suggestion, saying such matters should be left to the commission of inquiry established by the Government to investigate the allegations of kickbacks.

The inquiry, which will be headed by former Supreme Court judge Terry Cole QC, will investigate the UN's claims that AWB paid illegal kickbacks to secure wheat sales in Iraq.

AWB admits making the payments to a Jordanian firm, Alia, but insists it thought the fees were for transporting wheat around Iraq and did not know that Alia was a front for Saddam's regime.

AWB has maintained the payments were approved by the Department of Foreign Affairs and Trade and the UN. The Government has denied it was aware of where the money was going.

Allegations have also surfaced this week that AWB paid millions of dollars in kickbacks to customers or governments in Pakistan, Yemen and Indonesia during the 1990s.

Mr Rudd said it "beggars belief that the Government knew nothing about concerns that had been raised at many levels about the Australian Wheat Board's commercial arrangements with Iraq".

The Opposition also claimed yesterday that the Government had been provided with regular reports by the Wheat Export Authority - a watchdog set up by the Government to monitor AWB when it was privatised in 1999. The WEA hired a consultant to investigate the incentives AWB offered to countries to entice them to buy Australian wheat.

Labor agriculture spokesman Gavan O'Connor suggested that Mr Truss had been provided with regular confidential reports on the kickbacks on offer.

"We know the results of these investigations have been communicated to the Government through the agriculture minister in annually confidential reports," Mr O'Connor said.

But current Agriculture Minister Peter McGauran said Mr O'Connor's comments were misleading. "The incentives to which the WEA referred in its annual report are listed and they cover items such as joint ventures, export credit breaks and staff exchanges," he said.

"The incentives referred to do not relate to monetary payments to third parties in overseas markets. The WEA's reports do not contain the sort of information alleged (by Mr O'Connor)."

An AWB spokesman said the allegations were designed to destroy the company's monopoly position as a wheat exporter. "One of our biggest concerns is that we are being continually attacked by unnamed sources," he said.

"All AWB has done is attempt to get the best price possible for Australian wheatgrowers and we have acted properly in our dealings to achieve that," he said.


http://www.theaustralian.news.com.au/common/story_page/0,5744,17487124%255E601,00.html