The Quid pro Quo of Political Patronage

The perception that money can buy public policy is highly corrosive to democratic government in Australia and the acidic stench pervading the political diaspora in NSW may yet destroy many senior Liberal party grandees.

Liberal power broker and former President of the Party, Senator Arthur Sinodinos, once Howard’s Chief- of-Staff has been caught failing to declare six company directorships on his register of pecuniary interests to the Senate and is now entwined in the ICAC investigation into political corruption in NSW.

Two companies associated with Sinodinos and undeclared to the Senate are Bunori Pty Ltd and Liberal Properties Ltd, both are believed to be fund raising vehicles associated with the Liberal Party that make potential donors difficult to track.

When Rudd set about introducing a mining profits tax some large mining companies pooled approximately $22 million for a television and video campaign to remove the tax that saw that Prime Minister’s almost immediate demise. The image of the Rudd lemon being squeezed was both memorable and disturbing for it was an exhibition of raw and blatant corporate muscle being exercised ruthlessly in our democracy.

The Carbon Tax was introduced by the Gillard Government by default as the result of a hung parliament and the power of the Greens. Effective from 1 July 2012 it provided a new corporate battle ground for those affected and resulted in the denigration and destruction of Australia first female Prime Minister. A campaign orchestrated and financed through donations to the Liberal Party by the polluters was brilliantly executed by Abbott who was careful at all times to blame the Greens; this so tarnished and unsettled Labour that they were removed from power at the next election.

It is of note that only some 185 entities paid the carbon tax in 2012-13 and that nine months after the introduction of the scheme carbon emissions from electricity polluters had fallen to a 10-year low.

As this is an essay on corporate power as exercised by business over government the boot is now on the other foot. Prior to the Budget Abbott and Hockey suggested that the diesel rebate scheme, originally only intended for farmers at 38% but subsequently hijacked by the mining companies, should be modified in the interests of fairness and revenue. They immediately backed down when threatened by the possibility of another Rudd type campaign; this time to replace Abbott with Turnbull.

The $2.4 billion a year diesel subsidy to the mining industry is no longer at risk.

The pre-election funding of the Federal Liberals through ‘Associated Entities’ by the Carbon Tax polluters to ensure the repeal the Labor /Green carbon tax means that a beholden Abbott must now perform.

Of the 15 large polluters who pay 70% of the Carbon Tax twelve are in the electricity business:

Company, Activity, Carbon units lodged in 2012-13 (million)
DF Suez, Electricity generation, 25.8
AGL, Electricity generation, 19.1
Macquarie Generation, Electricity generation,16.0
Delta Electricity, Electricity generation,13.3
Energy Australia, Electricity generation,11.9
Origin Energy , Electricity generation,11.6
Stanwell Corporation, Electricity generation,11.0
CS Energy, Electricity generation, 7.4
Woodside Energy, LNG production, 6.6
Verve Energy, Electricity generation, 5.5
NRG Gladstone, Electricity generation, 4.8
BlueScope Steel, Iron & steelmaking, 4.7
Alcoa, Alumina refining, 4.6
Alinta Energy, Electricity generation, 4.6
Millmerran, Electricity generation, 4.4

These companies are amongst the nation’s principal electricity generators, mostly created by state governments via privatisation. Most have close political connections that have allowed them to increase electricity prices by blaming the Carbon Tax. Wind and solar further reduce their sales, hence eat into their profits; as a result, these activities under an Abbott wearing his anti-Green/Liberal mantra are in the process of being curtailed or unwound.

The exception that proves the rule is Hydro Tasmania’s unique green utility generating electricity via the Tasmanian high country. Enabled to claim carbon credits of some nearly $200 million from the carbon tax, this sum will be credited to Tasmania each year until repeal. I ask, Are our 12 Tasmanian Senators supposedly representing the interests of Tasmanians in the Senate defending this huge green cash flow into our tiny island; if not why not?

Was Hodgman’s expensive 2014 State campaign in part funded by the Federal Liberals as a Quid pro Quo to keep the lid on this State’s claim for $200 million in Carbon Credits?

It is notable that Hodgman has yet to utter on this enormous future loss of revenue to his State.

Which of the fifteen major polluters on the above list made large donations to the Liberal Party; a party promising to immediately repeal the Carbon Tax legislation should the Liberals be elected?

Some sources for this information are listed below. It is difficult to track as most donors conceal their identity behind front organisations such as the Cormack Foundation Pty Ltd, Greenfields Foundation, The Free Enterprise Foundation, Bunori Pty Ltd or Liberal Properties Pty Ltd to name but a few. Any donation of less than $12,100 does not have to be declared.

The Australian Electoral Commission (AEC) is the public broadcaster of political largesse and lists the following donations to the Liberal Party for the 2012-13 financial year for those polluters who appear in the top fifteen:

AGL Energy Ltd $29,920

Energy Australia $25,000

Origin Energy $36,785

Woodside $120,000

This declared total should be compared with:

The Cormack Foundation Pty Ltd whose Directors are three Liberal blue bloods, John Calvert- Jones, married to Rupert Murdoch’s sister with influence over the political agenda of The Australian, Hugh Morgan formerly of WMC and once a member of the Board of the Reserve Bank is a major player in The Lavoisier Group of climate change deniers and lastly Charles Goode, former Chairman of the ANZ Bank and Woodside Petroleum:

2011-12 Receipts $9,008,112 Payments to Liberal Party $7,469,167
2012-13 Receipts $3,279,259 Payments to Liberal Party $5,808,856

Much of this donated money is sourced from investment income from shareholdings built up over many years in Australian public companies. The size of these holdings and how some of this money was acquired remains as yet unknown.

The Greenfields Foundation is a trust whose modus operandi was created through a personal guarantee from an individual over the debt of a political party to a financial institution. This individual later pays out the debt transferring it to himself, the Party then is indebted to an individual not an accountable institution. The individual can forgive the debt or assign in part his personal debt in any quantum to any person or company for purposes of redemption or interest. When monies are paid to him they are no longer a political donation but a debt repayment to an individual and not accessible to the AEC. The Greenfields Foundation pioneered this scam and the methodology may survive under different names using the same logic.

The Free Enterprise Foundation is still a major player as evidenced before ICAC in NSW. Nathan Tinkler, a onetime controller of Whitehaven coal, stated that he gave $53.000 to the NSW Liberal Party from his company Boardwalk Resources, ‘Because I am a great guy’. He was unable to explain how this was actually paid to the Free Enterprise Foundation in Canberra. Property developers cannot make political donations in NSW… it has been disclosed before ICAC that two of the biggest property developers in NSW, Westfield and Meriton, used the Canberra-based Free Enterprise Foundation to legally gift $200,000 to the Federal Liberal Party. In 2012-13 the Foundation received donations totalling $715,724. This is the tip of an iceberg as exposed via ICAC; the majority still hidden from prying eyes.

The ICAC in NSW has yet to investigate Sinodinos, Bunori Pty Ltd and Liberal Properties Ltd for connections – if any – with those who had large Carbon Tax liabilities in coal or electricity; or those who may or may not have used this avenue to place bets on the removal of the Carbon Tax under a Federal Liberal Government.

The financial rewards received from large public companies in exchange for an Abbott pledge to remove the Carbon and Mining Taxes – by putting the odium and blame for their introduction on the Greens – has been a triumph for Abbott.

Emboldened by his success, a new line of Liberal attack is the pursuit-at-all-costs of scrapping World Heritage listing over part of Tasmania’s forests for a loss-making logging company from Sarawak who surrendered its timber quota’s for $26 million in cash to allow protection under the TFA.

This consuming passion also smells of Abetz and his hatred of all that is Green.

I suggest that these corporate alliances that have laid enormous golden eggs may yet – via the NSW ICAC – come back to haunt and bury the Abbott Liberals.