ICAC has heard a cosy little story of Ian Macdonald’s allies sealing a deal which could have been worth $100 million to the NSW government — over a waterfront dinner and a magnum of pinot noir.
The Independent Commission Against Corruption will widen its scope to look at allegations former New South Wales mining minister Ian Macdonald acted recklessly in office. The announcement came as the fourth and last inquiry into allegedly corrupt coal mining tenders kicked off.
Counsel assisting Peter Braham SC told the hearing this morning Labor ministers Luke Foley, Doug Cameron and Anthony Albanese will be called to give evidence next week, emphasising they would only be giving evidence about ALP factions with no suggestion of any impropriety.
Braham told the inquiry the main transaction under review — the 2007 granting of a coal mining licence to a company called Doyles Creek Mining — was a “financial disaster” for the state. But it turned out to be a “gold mine for a group of well-connected entrepreneurs”, who managed to turn an investment of several hundred thousand dollars into an asset worth about $100 million.
In effect, this was like “handing over a $100 million cheque” to the investors, counsel said.
The main player in all of this is union official John Maitland, who ran the main coal mining union, the Construction, Forestry, Mining and Energy Union, and was also a close factional ally of Macdonald, who along with Eddie Obeid was one of the two key factional powerbrokers within the party. Macca kept his position in the upper house of the NSW Parliament largely due to the support of Left-wing unions like the CFMEU.
The Commission heard a tantalising reference to a meeting between Macdonald and Maitland at the city Chinese restaurant, Noble House, in which the minister was pleading for his political life; hopefully this will be further investigated in later evidence. Other crucial meetings were held at the private dining room of pricey Sydney steakhouse Prime, a frequent haunt of the minister dubbed “Sir Lunchalot”, and the seedy but atmospheric late-night drinking haunt the Nippon Club. The deal was actually signed at Sydney waterfront restaurant Catalina over a meal costing $1800 — a magnum of pinot noir was cracked open to celebrate the signing of the deal.
The process by which the deal was adopted was astounding, said the counsel, saying Macdonald rejected the usual process of holding a competitive tender which “could have raised many millions of dollars for the state of NSW”. The minister simply awarded the licence to Doyles Creek Mining, owned by a group of investors which included Maitland and Newcastle businessmen Andrew Poole and Craig Ransley. They must have been “laughing all the way to the bank”, Braham said.
Macdonald, the star of an earlier ICAC inquiry into his receipt of personal services from a sex worker called Tiffanie, did so against departmental advice, the Commission was told. Almost immediately, questions were raised in the media and in state Parliament, and by 2011 the matter had been referred to ICAC.
What has been very interesting is the the recent public squabbling among Labor leaders over who was most responsible for the actions of Macdonald and Obeid.
The one person with clean hands is former NSW premier Nathan Rees, who fired Macdonald in 2009, later making a speech to the party caucus saying that he was “determined to clean up politics in NSW and … restore integrity to government:
“The old regime will never again dictate the fortunes of our party, nor will they regain the levers of control. Should I not be premier by the end of this day (there had been a leadership challenge) let there be no doubt in the community’s mind that any challenger will be a puppet of Eddie Obeid and Joe Tripodi.”
Of course, the caucus then elected Kristina Keneally as premier, and Macdonald was reinstated to the ministry under pressure from Obeid and his henchmen.