Jul 12, 2010

Who profits from our foreign aid? The untold story of GRM International

For nearly a decade one of Australia’s most successful aid companies and its biggest casino operator were owned by the same company.Wendy Bacon and Flint Duxfield tell the untold story of GRM International.

If you ask most Australians who delivers Australian government aid overseas, they’ll most likely list big, well-known Australian NGOs such as Oxfam, World Vision or Caritas. Most would be surprised to know that for nearly a decade one of Australia’s most successful, although little-known, aid companies and its biggest casino operator were owned by the same company.

We’ve studied the company records of one of Australia’s biggest foreign-aid companies — GRM International Pty Ltd. Until December last year, GRM International was fully owned by the Bahamas-based company Consolidated Press International Holdings (CPIH) — a key company in the private empire of one of Australian richest families, the Packers.

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12 thoughts on “Who profits from our foreign aid? The untold story of GRM International

  1. jungarrayi

    Let me paraphrase:
    Who profits from The Northern Territory Intervention? The untold story of countless outside contractors,consultants, researchers and bureaucrats.

    Rather cute, but recently a report was prepared for FaHCSIAH by TNS Global.
    The report on a survey of GBMs (Government Business Managers- or Ginger Bread Men) is an amazing piece of self-congratulary clap-trap. Don’t know what it cost, nor if tax was paid on the fee in Australia, but suspect it didn’t come cheap.
    Suggest you Google TNS.

  2. lindsayb

    What a surprise, to see the super-rich suckling at the public teat (again).

  3. Him Nao!

    Your story is incomplete and the writers dont understand the business they are writing about – poor showing. Most of the revenues are pass through for GRM’s income statement; the returns generated by the business are good but also fair. Without businesses like GRM the management of aid programs would be left to the bureaucrats of AusAid who, while capable administrators and programmers, do not have the experience or expertise to provide local program management and are often guilty of poor program design, as is proven by some of the RAMSI activities.

    The GRM’s of the world make the aid money spent by Australia’s taxpayers go further by hiring the most experienced and capable managers and development practitioners, leading to more effective and sustainable development efforts. They make a profit necessary to support their business. Australians should support this approach and your reporting should be more complete.

  4. dire

    check out http://www.private-eye.co.uk and do a search for CDC it would appear getting rich from aid and using tax avoidance is not an Australia only problem.

    if you check the Eye site there is a great story on the front page at the moment on how CDC tried to ban the Eye from an event and how it went badly astray

  5. John Bennetts

    Him Nao!,

    What an astounding and unbelievable contribution you have provided!

    Not a whit of evidence or a scintilla of common sense. You are obviously in the pay of some smoke and mirrors expert and you are trying your best to achieve, with not a single scrap of credibility, some sort of financial miracle.

    There is a fair case to be made for unravelling trusts, especially those resident in tax havens. There is no need for Wendy Bacon and friends to explain their cfradibility – she has been a credible and solid voice of the public interest for over 40 years.

    OK, so who the f_ck are you and what are you trying to represent? I look forward to as many future chapters of this story as there may be. It is clear to me that GRM is a corporate parasite.

    Thanks, Crikey!

  6. BDS

    Actually there is no need to dismiss Him Nao so outright. Like many things there should be a balance … there is a role for TA as much as other mechanism and delivery through companies, NGOs and government to government and its clear there needs to be a better balance in some areas. While I wouldn’t dismiss the capabilities of AusAID staff as easily as Him Nao there are things that companies do better, things NGOs do better and governments. Profit isn’t instantly evil and likewise not-for-profit isn’t instantly good … there is plenty of politics, backstabbing and bitching going in the NGO ranks as they chase funding and it does create a conflict of interest for them to be given the right to comment on companies as if from the position of perfection and purity.

  7. lindsayb

    Although companies have a right to make a profit from work that they do, we as taxpayers also have a right to see where our money is going, who is making a profit from our largesse, and how large this profit is.

  8. Sean

    It certainly sounds suspicious. I’ve been under the impression for quite some time that most of the money allocated for foreign aid goes straight into the pockets of very well paid Westerners who are ‘development consultants’ etc, who, of course, need to be remunerated well first for the very risk of going into dangerous developing countries full of exotic diseases and civil wars plus then providing their amazing development expertise. Of course, these salary dollars are spent on lavish houses and private schools for their kids in Western countries where they live most of the time, not given away to the poor starving teeming millions of the world — after all, we’re only here to teach them to fish, not give them the fish.

    So while Centrelink cracks down on the poorest of the poor here for nickel and dime ‘rorts’ and overpayments (often made in Centrelink error), literally trying to sue individuals in the courts for nickels and dimes, they dole out largesse unaccountably to Australia’s richest man and his cronies. It’s not enough for these people to make money out of their rubbish airheaded rag magazines at supermarket checkouts that add nothing to the social fabric of the country, but they also have to extort money from the lush public purse as well for extra revenue streams. I think we can all see how the rotten government system works now — government of the people, by bug business, for big business, fooling most of the people all of the time.

  9. Sean

    -bug, +big — having a New Zealander moment…

  10. Him Nao!

    Dear Mr. Bennetts,

    I understand how easy it is to get emotional about the perceived misuse of taxpayer money. And there is no question that significant abuses happen in the system. But I think it is important for you and those in your camp to hear the other side of the story.

    I work for local NGOs for a living, and I make very little money. I’ve been working in development for 10 years throughout the world. I know more than you and likely a lot more than the writers. I am usually the one railing against overpaid consultants.

    The consultancies CAN BE an effective way to manage aid programs, full stop. But they can only be as good as the project design approved by AusAid and their kind. The profit they make on this effort is fair – I know, I’ve seen the contracts. The pay received by their direct employees is low compared to other jobs in Australia. Yes individual consultants that they hire can make a lot of tax free money, but they have very uncertain employment, they must carry their costs at home, they live abroad in uncomfortable places for extended periods and they often have a very difficult to find skill set.

    This issue is an easy one to get angry about, and as usual, the press do a crap job of gathering the data. There are consultants out there making obscene money – and they are typically hired directly by the Aid agencies or other government organizations who have little program management experience. AusAid is particularly guilty of this behaviour and it is incredibly disruptive to the development process. The consultancies are there to prevent this activity and ensure the Australian taxpayer is getting a fair deal for its money.

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