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WA Inc was the name for a set of public-private partnerships in Western Australia in the 1980s associated with the Western Australian Development Corporation, which became a political scandal. The state government, which was led for much of the period by premier Brian Burke, engaged in business dealings with several prominent businessmen, including Alan Bond, Laurie Connell, Dallas Dempster, John Roberts, and Warren Anderson. These dealings resulted in a loss of public money, estimated at a minimum of $600 million and the insolvency of several large corporations.
Bond and Connell were major contributors to the party in government, the Labor Party and its remarkable fundraising structure, the John Curtin Foundation. A royal commission (the Royal Commission into Commercial Activities of Government and Other Matters) was established in 1990 by Labor premier Carmen Lawrence to examine the dealings.
Connell alleged in that Hawke dropped a proposed gold tax after Connell and various Perth high-flyers donated $250,000 each to Labor during an infamous lunch in Brian Burke's office in 1987—a claim the former PM vigorously denied.Burke's loyalty to those who had donated their efforts (and money) to Labor was no less fervent. Taking the John Curtin Foundation axiom to the next level, Burke created the West Australian Development Corporation and installed fellow Catholic John Horgan (pictured second from left, top) on $800,000 a year, an extraordinary figure for a public servant not only then but now.—Journalist Tony Barrass, 2009.
In 1991, political scientist Paddy O'Brien identified the members of the government most associated with WA Inc deals as premier Burke and his successor Peter Dowding, deputy premier David Parker, industrial development minister Julian Grill and attorney-general Joe Berinson.O'Brien P. The Origins and Development of WA's Executive State, in The Executive State —WA Inc & The Constitution, (Perth 1991).
A proposed petrochemical Chemical plant was to be built as a joint venture between Laurie Connell and Dallas Dempster, both being businessmen with close government connections. $100,000 was outlaid as a deposit on a block of land at Kwinana but otherwise the proposal did not proceed beyond designs and stood as a basis for fund-raising, loans, collateral transactions, development of proposed plant, management fees to Bond Corporation and, eventually, was sold for $400 million —$175 million being provided by a government agency, WA Government Holdings.
In 1991, barrister Bevan Lawrence published what he regarded as a conservative itemisation of the government's actual losses. The figures are summarised as follows:
| $408 million |
| $155 million |
| $140 million |
| $74 million |
| $100 million |
| $877 million |
The commission of three was headed by Geoffrey Kennedy and joined by Sir Ronald Wilson and Peter Brinsden, with a brief "To inquire into and report" whether there had been "corruption, illegal conduct, improper conduct, or bribery" on the part of any person or corporation in the "affairs, investment decisions and business dealings of the Government of Western Australia or its agencies".
1.1.2 Some ministers elevated personal or party advantage over their constitutional obligation to act in the public interest. The decision to lend Government support to the rescue of Rothwells in October 1987 was principally that of Mr Burke as Premier. Mr Burke's motives in supporting the rescue were not related solely to proper governmental concerns. They derived in part from his well-established relationship with Mr Connell, the chairman and major shareholder of Rothwells, and from his desire to preserve the standing of the Australian Labor Party in the eyes of those sections of the business community from which it had secured much financial support.
1.1.3 Subsequently, Mr Dowding, as Premier, presided over a disastrous series of decisions designed to support Rothwells when it was or should have been clear to him and to those ministers closely involved that Rothwells was no longer a viable financial institution. This culminated in the decision to involve the Government, through WAGH, in the Kwinana petrochemical project as a means of removing the Government's contingent liability for certain of the debts of Rothwells. Electoral advantage was preferred to the public interest.
1.1.4 Personal associations and the manner in which electoral contributions were obtained could only create the public perception that favour could be bought, that favour would be done. WA Inc Royal Commission Report Part II (final) 12 November 1992, at State Law Publisher, Government of WA
In an earlier finding, the commission had summarised:
The commission's report included a confidential appendix (not published) containing an "outline of matters to be referred to the Director of Public Prosecutions", WA Inc Royal Commission Report, Appendices 19 October 1992, at State Law Publisher, Government of WA and a list of recommendations impinging on open government, accountability, integrity in government, the Parliament, the administrative system, and a proposed Commission on Government
Burke and his predecessor, the Liberal premier Ray O'Connor ultimately served prison sentences as a result of convictions which arose from findings of the commission. The premier immediately after Burke, Peter Dowding, and public servant Len Brush were both found to have acted improperly.
The Western Australian Development Corporation's remit was reduced over time, and it was finally wound up in 1998.
Absence of important witnesses
In the introductory part of its report, the commission noted that it had heard from 543 witnesses encompassing 847 appearances. ... There were, however, some who may have been able to give valuable information to the Commission, who died before the Commission hearings commenced or after they had begun. There were others who were unwilling to assist and were beyond the reach of compulsory process. WA Inc Royal Commission Report, Contents and Introduction 19 October 1992, at State Law Publisher, Government of WA
The following had died or been incapable on health grounds: Peter Beckwith (Bond Corporation), Bill Burgess (Rothwells), Robert Holmes à Court, Thomas Hugall (Rothwells), Bruce Kirkwood (State Energy Commission of Western Australia), Andrew Mensaros (former Liberal state minister), Terence McDonnell (solicitor), and Jack Walsh (Rothwells).
The following declined to give evidence: Yosse Goldberg (entrepreneur), Peter Mitchell (Bond Corporation), Tony Oates (Bond Corporation), and Ms Kim Rooney (wife of David Parker). Dr Shrian Oskar was serving a 6-year prison term in the UK. The witnesses whose testimony was received by the commission are listed in an appendix to the report.
Main findings
After approximately 21 months of enquiries and hearings, the commission's final report began:
1.1.1 The Commission has found conduct and practices on the part of certain persons involved in government in the period from 1983 to 1989 which were such as to place our governmental system at risk. Unfortunately, some of that conduct and some of those practices were peculiar to Western Australia; but there is no reason to believe that many of the fundamental questions raised by our inquiry were unique to this period or to this State. On the contrary, as detailed studies in other States and overseas clearly demonstrate, they have been raised elsewhere as a consequence of events similar to those which we have experienced.
The to risk the public resources of the State without its actions being subjected to critical scrutiny and review. Effective accountability was a casualty of its entrepreneurial zeal. Influence in the conduct of this State's public affairs was captured by a small group of self-interested businessmen.
Summary of main issues
Costs and outcomes
The royal commission cost $30 million, including $12.5 million in witness costs. Of the latter, $3.6 million funded Burke's own legal fees ($1.71 million) and those of David Parker ($1.92 million).
See also
Notes
(Page numbers cited in PDF documents are PDF pages, not necessarily corresponding to folio numbers printed on original pages.)
Further reading
External links
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