Tuesday, November 28, 2006

AWB and Cole Enquiry Aftermath

Much has already been written and analysed in the days following the release of Commissioner Cole's Enquiry into AWB Kickbacks.

The media has been full of Government and Opposition press releases and staged TV & radio announcements.

Some salient points to consider:
  • Commissioner Cole described AWB as having a culture of deceipt and concealment.
  • There were no criminal findings against politicians, nor of anyone within DFAT. Indeed, there were no criminal findings against anyone! Mr Cole has, though, recommended a task force to investigate possible criminal behaviours by 12 people, 11 of them from AWB.
  • The Government claims to be relieved there were no findings against any Ministers - but that was not within Mr Cole's terms of reference. He DID find that DFAT had no policy or procedures to deal with allegations of AWB breaching UN sanctions. That is, a department, for which a Minister is responsible and accountable, had serious failings of competency.
There might well be a slow, quiet cleaning-out in Mr Downer's department (DFAT) over the next 12 months.

There is much angst from some politicians over the future of AWB and the export monopoly ("single-desk") licence it holds. Some suggest that the single-desk should go, others want it to remain in AWB's hands, while a few wnat it transferred, possibly to government hands. Certainly the following will be considered:
  • the political ramifications of upsetting the close relationship between parts of the National Party and AWB
  • the shareholder ramifications, including for families of some politicians, of removing the single-desk from AWB, or its power of veto over other companies exporting wheat
  • the global environment of wheat trading, where the US and many other countries provide prohibitive subsidies
I think the single-desk should stay, given the global commercial practices in wheat trading and other countries' farm subsidies. AWB has shown itself to be not "fit and proper" to trade internationally, and a change of personnel, per se, does not change an institutionalised culture such as that described by Commisioner Cole. Until such time as AWB's board is replaced, and a legal and ethical business culture established and fostered over some years, it should be in government hands.

The Analyst