In
natures infinite book of secrecy
A
little I can read.
Antony and Cleopatra, Act one, Scene two.
FOI
revelations. The NIAA
FOI log contains two recently released documents that expand the information
available in the public domain albeit only at the margin. I have also had
access to documents released in response to a third FOI but not yet made
available on the Disclosure Log. In this post, bolded text has been added by me
to emphasise matters of particular salience to the arguments made here. The
highlights below were highlighted in the documents provided by NIAA.
Request One FOI/2425/039 dated 30 January 2025 (link
here). This request sought the
NIAA’s proposed response to a series of questions on notice from Senator Pocock
in late 2024 (which had presumably been delayed in the Minister’s Office and
not seen the light of day when the request was made). Once made available, it revealed
that the NIAA’s Group Manager Integrity had attended the ALC Board meeting on
16 October 2024 ‘to support Board discussion
regarding Mr Hewitt’s employment arrangements.’ The ALC terminated the CEO’s employment at
that meeting. NIAA failed to respond substantively to the Senator’s request
for information on what legal or policy advice had been provided to the ALC
Board by the NIAA attendee.
Request Two
FOI/2425/065 dated 14 April 2025
(link
here). This request relating to the
February 2025 Senate Estimates hearings (link
here) sought All briefs prepared by the agency for the Minister, her
staff, senior staff of NIAA, and other Ministers or portfolio agencies which
relate to the governance and operations of the Anindilyakwa Land Council,
associated corporations in receipt of royalty equivalent payments, the proposed
Winchelsea mine, the 2023 ANAO Audit of the ALC; the National Anti-Corruption
Commission investigations in relation to Groote Eylandt matters; and/or Groote
Eylandt generally."
The response comprised
two documents prepared in February 2025. The first document included the
following dot points under Key Talking Points:
· The Ministerial response to the petition
was tabled on 29 February 2024. The response states that the Minister has
referred the issues raised in the petition and media articles to the NIAA’s
Integrity Group for review and referral to relevant Commonwealth and
Territory agencies if required.
· The NIAA received some information
that was subsequently referred to the National Anti-Corruption Commission
(NACC).
· As part of NIAA’s response, the NIAA
commissioned an independent review of the ALC’s responses to the issues and
recommendations of the ANAO audit.
In a section
headed ‘If asked: What is NIAA doing to address the concerns in relation
to ALC governance?’, the brief discussed the Bellchambers Barrett
Review, referring to it as ‘independent’, and confirming that that the Group
Manager Integrity had determined the scope and composition the review.
The brief then
states:
•
The ALC CEO and Board fully cooperated with this independent
review….
•
In my capacity as NIAA Integrity Group Manager, I accompanied the
independent reviewer to Groote Eylandt on 27 and 28 May 2024 to gather
additional evidence and meet with the ALC Board and management.
•
On 24 Sepember [sic] 2024, I also attended Groote Eylandt to provide the newly
elected ALC board members a walkthrough of the issues review report.
•
On 15 and 16 October 2024, I attended Groote Eylandt to work with the
board members to support their next steps in progressing the governance
arrangements of the ALC board.
A second
document was the brief prepared for the NIAA CEO.
The CEO brief
confirms that the ALC has engaged Yamagigu Consulting to act as Independent
Adviser to the ALC Board and to develop a governance framework in consultation
with the NIAA. Yamagigu is associated with Deloitte Australia.
The CEO Brief
states:
· The August 2024 Bellchambers Barrett
review concluded that while significant progress has been made by ALC since May
2023 across the ANAO’s 15 recommendations, none had been fully implemented.
· The Minister wrote to the ALC Board on
29 August 2024 to advise she was extremely disappointed to read the review’s
conclusion.
In a section
headed Former Chief Executive Officer Mark Hewitt, the Brief
notes:
•
The ALC Board terminated the employment of Chief Executive Officer (CEO)
Mark Hewitt on 16 October 2024 ….
•
The termination payment made to Mr Hewit [sic] was in accordance with
his contract of employment and provisions of the Fair Work Act 2009.
o If asked: Did the Minister approve the
termination payment?
o
[placeholder - brief was
provided to the Minister for approval in February 2025].
•
The CEO’s tenure had been a matter for the ALC’s Board.
•
The NIAA is aware of public concerns that Mr Hewitt allegedly misused royalties
and directed funds into a mining company in which he is a director.
•
The NIAA referred the former CEO to the National Anti-Corruption Commission
(NACC) in July May*
2024. [*Correction made by NIAA FOI Team]
Request Three
FOI 2425/066 dated 19 May 2025.
This request sought briefing notes and associated file notes and records
related to the attendance by NIAA officers at the ALC Board meeting in mid-October
2024 and all records of communications with the Minister or her Office in
relation to the attendance at the ALC meeting or in relation to discussions
with Mr Hewitt. Six documents were identified as being within the scope of the
request. Access to three (documents 1, 2 and 4) was refused in full on the
basis that they were legal advice that was subject to legal professional
privilege. The remaining documents were released in part. Extensive sections
were redacted on the basis of personal privacy exemptions.
Document 3 was an email to either the Minister’s
Office or senior NIAA officers dated 18 October 2024 advising inter alia
that the ALC had terminated the CEO and had appointed the ALC’s Chief Financial
Officer Colin Wakefield as interim CEO.
Document 5 is an email trail dated 5 November 2024
beginning with a request for a brief to support a meeting between the Minister
and the ALC the following day. NIAA’s Group Manager Integrity provided a series
of talking points under the heading Update on ALC CEO status. After
listing the date of the termination, the appointment of an interim CEO and the
ALCs intention to appoint a recruitment firm, the brief stated:
·
As
part of the termination process, Mark has resigned from the positions of
Executive Director Groote Holdings Aboriginal Corporation (GHAC) and CEO of
Winchelsea Mining
· The Boards of GHAC and Winchelsea are
considering next steps following Mark Hewitt’s termination, including
engagement of an independent advisor to assess current operations and the
required way forward.
Document 6 is a NIAA brief to the Minister dated
25 October 2024 responding to the ALC Chair’s correspondence dated 16 October
advising that the Board had terminated their CEO. Under a heading Key
Points, the NIAA noted that the Chair had advised that the CEO had
been terminated ‘on notice’ by the ALC and that the ALC Board had been
considering Mr Hewitt’s position for some time. The brief then stated:
5.
It is understood ALC will be submitting a supplementary budget request shortly
to cover Mr Hewitt’s final entitlements.
Commentary
on FOI documents released:
What jumps off
the page in the documents provided in response to Request One is the determined
effort by both the Minister and NIAA to keep the Minister at arm’s length from
whatever is going on. This signals, in turn, either prior knowledge of
misfeasance within the ALC, a statutory corporation in the Minister’s portfolio
for which she is responsible, or an appreciation that the events unravelling on
Groote and within the ALC were in some way potential political time bombs.
At least two
other issues arise from the Request One documents. First, the
close involvement of the NIAA in the Bellchambers Barrett Review – which as I
have pointed out previously was focussed solely on the ANAO recommendations and
not on the detailed issues identified - (including collecting evidence) and the
‘cooperation of the ALC CEO and Board’ raise serious questions regarding
the Review’s independence.
The second
issue concerns the
reason for the Group Manager’s attendance at the Board meeting. In the response
to Senator Pocock’s questions, it was stated that it was ‘to support Board
discussion regarding Mr Hewitt’s employment arrangements.’ In the Estimates
brief, it was ‘to work with the board members to support their next steps in
progressing the governance arrangements of the ALC board’.
The visit took
place in the context of a series of previous events: the prior visits to Groote
by the Group Manager; a letter from the Minister to the ALC expressing her ‘extreme
disappointment’ in relation to the poor ALC response to the Review that her
agency had been involved in developing for months; the referral by the NIAA of
the former CEO to the NACC four months previously. The visit coincided with the
NACC attendance at the ALC Office on Groote to obtain evidence. Given NACC
protocols to allow it to work with Commonwealth agencies on investigations, it
is possible that the NIAA had been provided with progress reports by the NACC.
The differences in the explanations set down in the two documents, although
nuanced and not definitive, point to something more than NIAA engaging in a
purely passive support role. Why else would legal advice have been necessary (bearing
in mind that the ALC employs its own legal advisers)?
The complete
absence of any preparatory briefing (except perhaps the emailed legal advice),
as well as the absence of any file notes recording the ‘support’ offered by the
NIAA officer suggests a deliberate effort to avoid future scrutiny and serves
to reinforce the sensitivity (and potential irregularity) of the discussions.
This is the bureaucratic equivalent of a police officer turning off his/her
bodycam prior to engaging with a person of interest.
The Request
One CEO Brief (document two) confirms that notwithstanding NIAA’s awareness
of allegations that ‘Mr Hewitt allegedly misused royalties and directed
funds into a mining company in which he is a director’, and their decision
to refer the CEO to the NACC presumably in relation to at least these
allegations, the ALC decided to pay Mr Hewitt an unspecified termination
payment and the Minister appears to have been asked to approve that payment in
February 2025. This strikes me as unusual insofar as if it was entirely
consistent with the CEO’s land council employment contract and assuming that
the contract which has never been made public adheres to standard employment
practice), there would have been no need to obtain the Minister’s approval. On
the other hand, if the ALC proposed to pay any amount related to his
termination as CEO of GHAC and/or Co-CEO of Winchelsea Mining, the ALC may well
have found it necessary or convenient to seek ministerial approval for an
expansion of its section 64(1) operational budget approval or for an approval
under section 36 of the ALRA (link
here). I have previously argued that the former CEO’s simultaneous roles
constituted misfeasance insofar as the ALC CEO salary set by the Remuneration
Tribunal is for a full-time position, and it seems unlikely that the Tribunal’s
approval was sought and granted for the CEO to engage in additional paid
employment.
The fact that
the document 5 of Request Three makes clear that the Mr Hewitt resigned
from his roles on Winchelsea and GHAC ‘as part of the termination process’
adds to the likelihood that the Minister was made aware of and agreed to
termination payments for Mr Hewitt linked to a notice period for these roles.
Importantly, the apparent willingness of the ALC to intrude financially into
the internal affairs of GHAC and AAAC/Winchelsea Mining (apparently with the
tacit assent of the NIAA) also reinforces
the argument I have made on numerous occasions that the ALC exercises
effective control over these corporations through the allocation of section
64(3) payments and is thus in effect allocating royalty equivalent funds to
itself in contravention of the intent of the ALRA.
The CEO Brief
also confirms that NIAA’s referral to the NACC was in May 2024, a year after
the ANAO report was issued. The allegations mentioned above that likely formed
the basis for the NIAA referral of the then CEO to the NACC were two of
numerous concerns described in the ANAO performance audit over a year before
the referral. Why then did it take a year for the Minister and NIAA to make the
referral? And what changed to persuade them to act in May 2024?
As I have long
argued in my posts on this blog, there appears to have been a deliberate and
sustained attempt by NIAA and the last two Ministers to ignore and downplay the
concerns raised by the hundreds of signatories to the February 2024 petition to
Parliament and the numerous serious issues raised by the ANAO report. Whether
intentional or not, it amounts to complicit behaviour with respect to these
issues. As mentioned above the tactic adopted was to establish a review that
focussed solely on the ANAO recommendations, and to ignore the myriad concerns
and red flags raised in the detail of the 2023 ANAO report. What is less clear
is why this policy of regulatory neglect was pursued.
I have long
taken the view that not only were there shortcomings in the ALC’s management
processes, but that the NIAA and its ministers have failed in their role as the
‘regulator’ oversighting the operations of the ALC and particularly its royalty
and royalty equivalent distributions.
The unexplained
termination of the ALC’s CEO in October 2024, the determined efforts of all
involved to downplay those events, the complete absence of any justification or
rationale form the ALC, and the secrecy imposed until now on the termination
payments made to him notwithstanding the concerns that were significant enough
to underpin a yearlong investigation by the NACC, suggests that there is much
more to this than is currently available on the public record.
One hypothesis
that is consistent with the facts as we know them is that the Government decided (utterly
belatedly) that the ALC should terminate the CEO to set up a situation where a
potentially adverse NACC report could be defended with the blithe response that
the individual responsible for whatever egregious flaws are determined to have
existed has already been dealt with. Persuading the ALC would be simple: the
Minister had the leverage of only partially approving the ALC’s budget for
2024/25 as well as numerous ways in which to make the land council’s ongoing
operations difficult. Persuading the former CEO (and his spouse) to depart
quietly would be trickier. The offer of generous termination payments would
assist, but other inducements are also conceivable. In this scenario, the ongoing
silence of the terminated CEO would be more securely achieved if the
termination payments were accompanied by a formal non-disclosure agreement.
Concluding
comment
In my view,
the pervasive veil of secrecy that has been thrown over this whole episode would
be necessary only if the decisions taken were not able to be justified
according to law and were not able to meet the so-called ‘pub test’. The fact
that questions from Senator David Pocock have been ignored or answered with
misleading diversions serves to emphasise the determination of the Commonwealth
to avoid public scrutiny. The fact that the veil of secrecy remains
substantially in place merely reinforces doubts regarding the appropriateness
and propriety of the actions (and inactions) of ministers and the NIAA related
to the oversight of the ALC over the past decade.
The issues and concerns
raised by the ANAO and by the concerned community members who signed the 2024
petition to Parliament are yet to be addressed in any rigorous and
comprehensive way. The fact that the NACC is investigating unspecified matters
without any transparency in relation to the focus of its investigation is no
substitute for an open, transparent and rigorous examination of what has
transpired.
Unfortunately, the
reluctance to initiate such a forensic and strategic review appears to be an
essential element of the Commonwealth’s approach to the operations of the ALC (and
also reinforces the likelihood that the hypothesis outlined above is in play).
This means that we are reliant on the efficacy of the various accountability
institutions with a role on Groote to ensure that the systemic issues that
allowed the imbroglio on Groote to emerge and to flourish are identified, and
curtailed. I don’t see the NACC as the institution best placed to address these
systemic issues (though I hope they at least go some of the way to doing so).
The ANAO in
my view should step up.
It could undertake a follow up report to its 2023 performance audit. It
might also take a long close look at the issue of the effective control by
the ALC over the corporations involved in the Winchelsea mine and the
Little Paradise infrastructure hub, and which are in receipt of ongoing and
significant flows of royalty equivalents. A decision to qualify the annual
financial statements of the ALC (and the concomitant ramifications of such
a decision) would go a long way to addressing the systemic defects in the
current sector wide administration of the ABA and ALRA.
25 June 2025
No comments:
Post a Comment