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Senate Estimates: FADT Committee

Estimates & Committees
Lee Rhiannon 17 Oct 2012

Foreign Affairs, Defence and Trade Committee

Estimates hearings 18 October 2012

  • Senator RHIANNON
  • Ms Bird
  • Mr G Wilson
  • Ms Thorpe
  • Mr Robilliard
  • Mr Fisher

 Full transcript available here

Senator RHIANNON: How do you respond to the criticism that Australian dollars have been allocated to possibly win votes in the ballot for a seat on the Security Council, considering aid to Latin America has gone from no aid allocated to that region to $168 million since Australia's Security Council bid was announced and this happened at a time when the Independent Review of Aid Effectiveness raised serious questions about the merit of Australia's aid to Latin America and the review panel recommended a phasing out of programs in the region, and over the past six years Australia's aid to Africa has more than doubled?

Ms Bird : Senator, we canvassed this a little before you came in. We reject the allegation that aid has been used for that purpose. You will be able to explore this more fully of course with AusAID later on but the increase in our aid budget predated the Security Council campaign. It is directed towards meeting the Millennium Development Goals and meeting the needs of developing countries in that respect. Again, you will be able to get more detail on that front from AusAID later today.

Senator RHIANNON: Could you expand on Latin America? Latin America is the standout here where you have actually gone against what was recommended and the financial contribution has increased from nothing to well over $150 million.

Ms Bird : Sure. Again, I do encourage you to take this up later on with AusAID but the development needs in that part of the world, in the Caribbean, are important. They are ones where we have particular expertise which we can offer in a range of areas such as disaster, agriculture, public sector management. So it is very much targeted to the development needs of those countries, but again I do think it would be better to get more on that from AusAID later on.

Senator RHIANNON: Thank you.

 

[ . . . ]

 

Senator RHIANNON: An Australian listed mining company, Mineral Commodities Limited, MRC, is attempting to develop a mineral sands project in South Africa. Considering that a local community member working to expose human rights abuse by MRC lodged complaints with the Australian Securities and Investments Commission and the Australian Securities Exchange with respect to inaccurate and misleading statements by MRC, what involvement or association has DFAT had with this project?

Mr G Wilson : I am not aware of any DFAT involvement in the project, but I can follow it up for you in terms of any contact that has been made.

Senator RHIANNON: Is there anybody here who would have some information? Considering it has been quite controversial in Africa, I thought somebody coming to these estimates would have had some information about it.

Ms Bird : We will have to take that on notice.

Senator RHIANNON: Considering the international reputation of Australian mining companies can be damaged by the lack of public accountability and poor practice by junior mining companies—I have given one example, but there are a number of smaller mining companies operating in Africa—what measures does DFAT take to ensure such companies comply with international human rights and public accountability standards?

Mr G Wilson : The Australian government does seek to ensure compliance of Australian mining companies with human rights standards when operating in Africa. The Australian government has an ongoing commitment to universal human rights and to instituting practical measures to encourage more responsible business practices. We cosponsor the UN guiding principles on the advancement of the business and human rights agenda and we engage actively in discussions on these matters. The Australian government does expect mining companies operating in Africa to abide by local laws and to conduct themselves in accordance with internationally recognised standards for corporate social responsibility such as the UN guiding principles, the UN Global Compact, the OECD Guidelines for Multinational Enterprises and the OECD risk awareness tool for multinational enterprises in weak governance zones. These expectations are conveyed through regular industry outreach in Australia, including seminars targeted at the mining industry to highlight Australian laws applying to Australian companies trading internationally. We also encourage companies to adopt best practice principles, including, as I mentioned, the OECD guidelines. There are also ad hoc offshore outreach activities on expectations and obligations of Australian companies.

Senator RHIANNON: You mentioned offshore at the end then. I am assuming you mean by that that you would be undertaking similar activities in Africa, where there are now a number of Australian mining companies operating. Is that what you meant by offshore?

Mr G Wilson : There are regular discussions held with mining companies operating in individual countries. They would be provided with advice on the importance of adhering to local laws and Australian laws that may be applied extraterritorially.

Senator RHIANNON: Could you run us through what has actually happened with regard to that. You have mentioned that you have these outreach programs to address the expectations that the Australian government has with regard to local laws and the OECD and UN guiding principles. When have these events been held, what is their nature in Africa and who has attended?

Mr G Wilson : I would have to get back to you with the details.

Ms Bird : As Graeme Wilson said, there have been a range of activities. We are quite actively engaged in this area. We could take on notice those precise details.

Senator RHIANNON: Thank you for taking it on notice. If that could include the events, where they have been held and who has attended, I would appreciate it. Does DFAT scrutinise mining companies operating in Africa to ensure that they have not breached Australian Securities Exchange and Australian Securities and Investments Commission guidelines?

Ms Bird : No. That is not our role.

Senator RHIANNON: Considering relations with Africa are now becoming increasingly important for Australia and there is growing controversy around how mining companies are operating in Africa, could you outline what steps Australia is taking not only to inform those companies about how they should operate—and I understand that is what you have taken on notice—but to check up when there are problems so you can determine what Australia's response should be. Surely there must come some point when briefings are prepared for ambassadors, high commissioners, foreign ministers, about these problems that are occurring in Africa with Australian owned mining countries.

Ms Bird : As Graeme Wilson set out, we have a very comprehensive series of activities in this area. Australian companies by and large enjoy a good reputation. We certainly work with them to ensure that that continues to be the case, and we will keep doing so.

Senator RHIANNON: The way that answer was given, though, gave the clear impression that it is about providing information for how companies should operate, not addressing problems that are arising when mining companies abuse human rights, damage the environment, do not abide by local laws—and you have said there is an expectation that they will. After the fact, how are you dealing with these problems?

Ms Bird : Issues to do with local laws in the countries in which they operate and whether there are breaches are really ones for the countries in which they operate. As I said, we work very closely with Australian mining. They have a good reputation, and that is a good thing for Australia. We certainly work closely with them.

Senator RHIANNON: Are you seeing examples where smaller mining companies are breaking the law and not abiding by international guidelines and there is a potential for it damaging Australia's reputation and the standing of larger mining companies that attempt to abide by laws?

Ms Bird : As I said, by and large Australian mining companies overseas have a very good reputation, and that is important.

Senator RHIANNON: I would like to take up the issue of the Direct Aid Program. Are all grants under the Direct Aid Program counted as ODA?

Ms Bird : Yes. The Direct Aid Program grants are part of Australia's aid program. Yes, they are ODA.

Senator RHIANNON: Is that administered through AusAID or through DFAT?

Ms Thorpe : In the day-to-day management of the DAP we have a role, but the funding is with AusAID. The funding stays with AusAID and they manage the funding. It is not in our budget.

Senator RHIANNON: So they manage the funding, but it sounds like, if you are doing the day-to-day work, you make the decisions on where the grants apply to.

Ms Thorpe : We work with AusAID on that. The higher level stuff is worked through with AusAID, and the day-to-day management is then done—

Ms Bird : It is our posts. It is basically devolved to posts.

Ms Thorpe : It is devolved to posts, but the higher level is done with AusAID.

Mr G Wilson : It is actually administered by DFAT but it is funded by AusAID. The administration of the DAP is done on the ground, as was mentioned, by posts. There is a committee that is established, and usually the head of mission heads that.

Senator RHIANNON: It sounds like DFAT is driving it, making the important decisions, and AusAID hands over the cheques and is not so involved. Is that a fair summary?

Ms Bird : It is designed to give our posts fairly small sums of money that they can fund local worthwhile projects with. The AusAID development program tends to be on a much larger scale. What this does is allow posts to have a fairly small amount of money so that they can then fund some really worthwhile local projects which might not otherwise get aid funding. That is the purpose and that is how it works.

Senator RHIANNON: Who made the decision to extend DAP to the Australia-Africa Mining Industry Group? Was that a DFAT decision?

Mr Wilson : It is not a question of extending DAP to it; as was mentioned, we have DAP projects in Africa. There are applications that are made, and they are assessed on a competitive basis. It is possible for NGOs as well as industry and individuals to work with us. The program, as was mentioned, focuses on supporting small-scale development projects and activities that involve the beneficiaries in the identification, design and management of the projects. At times the DAP money—and there is a maximum of $30,000 per project—has been used to contribute to a larger development project and has been combined with other sources of money, including from other donors or from private companies or entities. That is particularly the case for projects which may be beyond the ordinary scope of the DAP budget.

In such instances, the DAP guidelines continue to govern the project and the beneficiary remains the local community or the organisation. At the end of the project, all recipients are required to complete acquittal reports, and that includes evidence of expenditure, receipts, written reports on tangible outcomes. There have been several DAP projects in Africa that have involved DAP money alongside funding from Australian companies, but that has enabled us to have a bigger impact on the community than would otherwise have been the case. That has been useful in terms of some local community projects.

Senator RHIANNON: Discussion papers released by AusAID this year on partnerships state that AusAID will not subsidise corporate social responsibility programs of miners or other work that would have occurred without AusAID support. I understand that 10 grants have been made available to members of the Australia- Africa Mining Industry Group, and that those grants are supporting corporate social responsibility initiatives. That effectively amounts to subsidisation because it is seen that CSR—corporate social responsibility—initiatives are the responsibility of the company, that that is not a role for aid money. We are talking about aid money, which the public expect is for the welfare of people, going to a mining company for their own corporate social responsibility. Why are these grants being used to subsidise programs that actually contradict AusAID's own guidelines?

Ms Bird : As my colleague mentioned, all of the DAP programs do have to be consistent with the ODA guidelines. AusAID guidelines have to be ODA eligible. You might want to explore some of this a bit later on with our AusAID colleagues, but certainly we administer the DAP programs within the overall aid framework. It just allows us to target, as I said, smaller scale projects which AusAID might not otherwise be able to do.

Senator RHIANNON: I would ask you to come back to the question I asked. I take your point about having to be ODA eligible, but then AusAID does expand on what is required. I have read out the very clear guidelines from AusAID: AusAID will not subsidise corporate social responsibility programs of miners. That is directly from AusAID, and you just explained that this money is also AusAID money, so do we not have a problem that aid money, public money, is being used by mining companies for corporate social responsibility that they are supposed to do themselves?

Mr Wilson : There is no money paid to companies. The focus is on the small-scale project, and perhaps you would have seen some of the types of projects—there is a development of a school for deaf students; the provision of fresh water and solar panels in local communities. The government is providing a contribution to that—as I said, a maximum of $30,000—and then companies in the relevant cases, where applications have been considered and approved, provide a contribution as well. We are not providing money directly to companies.

Senator RHIANNON: No, I take your point on that, and I think you have actually helped identify the problem that I think we have here in how DFAT is operating. I will add to the example you have given. Ghana, from what I understand, received a $2,500 package of support for community development projects in two mining areas in Ghana and Burkina Faso—and that comes from the Australian High Commission in Ghana. But again I go back to the point that is clearly set out by AusAID: not to be providing that type of assistance for corporate social responsibility programs of miners or other work that would have occurred without AusAID support. It should not be subsidised by AusAID. So we have a problem.

Ms Bird : No, with respect, I do not think we do. We are funding worthwhile small projects. AusAID are aware of this. They do not see any inconsistency or problems with their guidelines. We do not see any problems or inconsistency with their guidelines. We are funding small-scale, worthwhile, local projects with, as I said, full visibility. AusAID are aware of it. There does not seem to be any inconsistency there.

Senator RHIANNON: So you do not think the mining company should have done that because it is in an area where they are causing dislocation?

Ms Bird : Mining companies can do what they wish, and we encourage mining companies to act responsibly, but, to be clear here, this DAP money is funding specific local worthwhile projects which are within all of the various guidelines and frameworks for the AusAID program.

Senator RHIANNON: I would like to ask about Paladin Energy Ltd. Have they received funds through DAP?

Mr Wilson : Once again, the companies do not receive funds. They were involved in a project in Malawi. This was the one I mentioned about the development of the school for deaf students. That has been the example there.

I will just add, on the point of decisions about DAP money, that they are made independently of any considerations about these corporate social responsibility activities. They are made subject to DAP guidelines and assessed on the merits of the project.

In response to that question: yes, Paladin was involved in Malawi in the development of a school for deaf students.

Senator RHIANNON: Did you say that Paladin was involved in that school?

Mr Wilson : In the DAP project?

Senator RHIANNON: Yes.

Mr Wilson : Yes. It made a contribution to the DAP project, as the government made a contribution to the DAP project.

Senator RHIANNON: We do need to explore this more, because it is relevant here to ask what due diligence was done in deciding whether to give this grant to Paladin, considering—

Ms Bird : Senator, sorry, if I could just stop you there: with respect, the money is not going to Paladin; it is going to a project to which Paladin itself is making a contribution. I think that is important.

Senator RHIANNON: Thank you. I will ask it again. What due diligence was done in deciding whether to go into partnership with Paladin in giving money to a project that they were also giving money to, considering that Paladin have been implicated in serious labour and environmental abuses in Africa and are currently the subject of allegations of corruption in Malawi? In doing a school with a company, there is a partnership that obviously has to occur there.

Ms Bird : They have contributed money to a worthwhile project. We have contributed money to a worthwhile project. If there are allegations about their behaviour in that country, it is for that country to investigate any potential breaches. I am not aware of whether there are any at all, but, as I said, that is a matter for the country concerned. But it is a worthwhile project to which we were contributing.

Senator RHIANNON: Are you aware of these allegations about Paladin and their operations in Malawi?

Mr Wilson : Not specifically. In fact, my understanding was that Paladin enjoyed quite a good reputation in Malawi. It is certainly making a strong contribution to the economy there through its project.

Obviously, in terms of the DAP, the project, as was mentioned, is assessed carefully on its merits. They have a committee that goes through these very rigorous guidelines, which are publicly available, and it is all designed for the small-scale community project and the recipients of that. Generally, they have been very successful, and those who have received them have been very grateful. The sorts of acquittals that we have received have generally been very good.

Ms Bird : And I think it is worth noting that obviously this is done with full transparency, clearly.

Senator RHIANNON: Could you take on notice whether any briefings have been provided to DFAT about the issues surrounding the operations of Paladin in Malawi, please.

Ms Bird : Sure.

Senator RHIANNON: Thank you. Was a DAP grant of $2,000 provided for community development projects in two mining areas in Ghana and Burkina Faso?

Ms Bird : I have no doubt we have had some DAP projects there. I am not sure if my colleague has the details.

Mr Wilson : Yes, there was a project in Burkina Faso involving a company, Middle Island Resources. And the second one, Senator?

Senator RHIANNON: It was Ghana and Burkina Faso.

Mr Wilson : On the other one: in Ghana, yes, there was one involving Endeavour Mining. That was a school, water, sanitation and hygiene campaign in the western region. In Burkina Faso it was in partnership with an NGO: the offer of sustainable access to water and to improve agricultural productivity and food security of 14,000 community members, and the focus was on a market garden infrastructure.

Senator RHIANNON: Could you inform the committee of the role that DFAT played in the creation of AAMIG, the Australia-Africa Mining Industry Group? Does a working group between AAMIG, DFAT and AusAID still exist?

Mr Wilson : No, the government, or DFAT, played no role in the formation of AAMIG. It was formed completely independently of government, though we welcomed its establishment back in 2009 because it does provide a valuable forum for liaison between industry and government related to mining issues in Africa. Indeed, one of the recommendations of the June 2011 Joint Standing Committee on Foreign Affairs, Defence and Trade report on Australia's relationships with the countries of Africa was to encourage greater consultation between the department and Australian resource companies. But there has not been a working group established—

Senator RHIANNON: There is no working group between AAMIG, DFAT and AusAID?

Mr Wilson : No.

Senator RHIANNON: I have to finish up, so could I just put some questions on notice, please. Have there ever been terms of reference for the working group?

Mr Wilson : No.

Senator RHIANNON: So it never existed?

Mr Wilson : No, there is no formal working group. There are the occasional or periodic discussions that are held between representatives from DFAT, AusAID, Austrade and AAMIG—for example, most recently, at the Africa Down Under conference that was held in Perth—but they are of an informal nature. There is no formal working group.

Senator RHIANNON: Thank you for that. Could you take on notice when those informal meetings have occurred, where they occurred and who attended. Was support of any kind, monetary or in-kind, provided to the AAMIG by DFAT, AusAID or any other government body in the creation of AAMIG? I will leave it at that for now.

 

 

[ . . . ]

 

 

Senator RHIANNON: What measures are in place for DFAT to monitor and secure the safety of Tamils and Sinhalese who are deported back to Sri Lanka?

Mr Robilliard : As a general point, when people who have departed Sri Lanka illegally—including via people-smuggling ventures—return to Sri Lanka, they are interviewed by the Sri Lankan authorities at the airport on their return. Where it is a non-voluntary return, an officer from the Department of Immigration and Citizenship is present at that interview. Where it is a voluntary return, a member of the International Organisation for Migration, or IOM, is present. Where the person who has voluntarily returned had arrived in Australia as an irregular maritime arrival, IOM then provides those people with its normal assistance. I note that the AFP were asked questions on issues relevant to this at estimates on Tuesday. As was said there by the AFP, where any allegations of abuse are raised by a returnee, obviously our high commission would follow that up with the Sri Lankan authorities.

Senator RHIANNON: Are you aware whether there was a representative of the Australian government present when Dayan Anthony was deported from Australia to Sri Lanka and was held for 16 hours while interrogated by the Sri Lankan government officials?

Mr Robilliard : I do not have the details of that particular case. As I noted, if the person had been deported—in other words, they would have been, in those circumstances, an involuntary return—normal practice would have been for a DIAC officer to have been present. But I do not have the details of the individual case. I will take it on notice and get you a response.

Senator RHIANNON: Is Australia involved in any projects promoting human rights in Sri Lanka?

Mr Robilliard : Australia has a robust dialogue with Sri Lanka on human rights issues. We have canvassed these issues in previous estimates and we have noted the various representations we have made to the Sri Lankan authorities, as well as the representations we have made through multilateral institutions. In terms of specific projects on the promotion of human rights, I will take that on notice and get you a response.

Senator RHIANNON: Was DFAT aware, when the decision was made to appoint him, that the Sri Lankan high commissioner, Admiral Samarasinghe, was potentially implicated in war crimes which took place at the end of the civil war?

Mr Robilliard : I think these matters have been canvassed quite extensively at previous estimates. I recall you engaging with then Secretary Richardson on these matters in October last year. As the then secretary said, DFAT examined very thoroughly the record in relation to the nominee and concluded that agrement could be given.

Senator RHIANNON: It has been reported that the previous foreign minister had asked Sri Lanka to respond to the United Nations about war crimes which took place at the end of the civil war in 2009. Has the department taken steps to satisfy itself that the high commissioner had no role in the shelling of Tamil soldiers and civilians in the declared safety zone or in the prevention of the Red Cross accessing the injured. I appreciate the answer to the previous question, so I just want to take you to those two points—about the Red Cross activities and the shelling of Tamil soldiers and civilians. Were those aspects examined?

Mr Robilliard : I really have not got anything to add to my previous answer. As I said, the record was examined and a decision was taken.

Senator RHIANNON: Can you outline how closely DFAT works with the Sri Lankan government? What is the nature of the association in Sri Lanka between your representatives and representatives of the Sri Lankan government?

Mr Robilliard : It is the normal sort of relationship which the government of Australia has with foreign governments. It is across a range of areas. Our high commission in Sri Lanka is involved in the normal range of activities.

Senator RHIANNON: Given there are a few asylum seekers who have opted to return to Sri Lanka rather than stay in indefinite detention and also some who have had their humanitarian visa applications denied, what measures are in place for DFAT to monitor and secure the safety of those returning to their homeland?

Mr Robilliard : It is not our position to monitor or ensure the safety of people who are returned, whether it be to Sri Lanka or anywhere else, but, as I said earlier, if there are allegations of abuse, then those allegations would be pursued by the high commission with the Sri Lankan authorities.

Senator RHIANNON: Is DFAT aware of the recent phenomenon of political dissidents, and successful Tamil businessmen, being abducted in white vans?

Mr Robilliard : I am not aware of a phenomenon involving white vans, no.

Senator RHIANNON: This has been widely reported in Sri Lanka and it has been taken up in a number of areas. Could you take it on notice to ascertain if there have been any briefings supplied at any level within DFAT about this phenomenon of people being abducted off the streets in Sri Lanka?

Mr Robilliard : Yes.

Senator KROGER: Just on that, have you received any communications, written or otherwise, from Australian citizens who may originally be from that part of Sri Lanka in relation to any concerns about family or friends that may be caught up in continuing destabilising scenarios on the ground there?

Mr Robilliard : That is a very broad and general question. I would really want to take that on notice.

Senator KROGER: Let me narrow it down a little bit. Have you received communications, letters or otherwise, from the Tamil community seeking the support and assistance of DFAT and of the Australian government for immediate family in the area?

Mr Robilliard : I am not aware personally of such communications, but let me check on it and we will get back to you.

Senator RHIANNON: Is DFAT working with any NGOs that are endeavouring to highlight human rights abuses or highlighting the need for human rights to be respected in Sri Lanka?

Mr Robilliard : I am not aware of any specific cases, but let me take it on notice and I will get back to you.

 

[ . . .  ]

 

Senator RHIANNON: Has DFAT made a final consideration of whether to join the Voluntary Principles?

Mr Fisher : DFAT does not actually make the decision. It would be up to the government to make the decision.

Senator RHIANNON: Who in government—the minister?

Mr Fisher : It might be the Minister for Foreign Affairs that makes the decision.

Senator RHIANNON: You would obviously be giving advice. What is the time line of when you would be supplying your next round of advice to the minister, please?

Mr Fisher : We do not have a time line, but we are close to finalising advice to the minister. We have consulted with NGOs, with companies and most recently with other departments, and within our own department and with the people that run the Voluntary Principles initiative, so we are close to being in a position to ask the minister for his decision.

Senator RHIANNON: You are close to—

Mr Fisher : We are close.

Senator RHIANNON: 'Close' means this month?

Mr Fisher : I would not put a time frame on it.

Senator RHIANNON: Leaving aside when he will make his decision, can you inform the committee of when you will be handing your advice to the minister?

Mr Fisher : Again, I would not put a time frame, but we are towards the end of the process.

Senator RHIANNON: In response to a question I previously asked about this—this was in May, in responses to questions on notice—you talked about final consideration of whether to join the Voluntary Principles et cetera, and then you stated 'which are scheduled to be concluded shortly'. So we had 'shortly' in May, and now we are in October. I would have thought that 'shortly' would be between May and October. Can you provide the committee with some more information about this?

Mr Fisher : I can say that we have done some additional things since we met here in May. As I have just said, we have been doing some internal consultation and some consultation in particular with the members of the Voluntary Principles initiative. We have undertaken some consultations internally between agencies, within DFAT itself and with the initiative, to do things like look at the cost of joining, the modalities for joining, how the cost might or might not be shared across agencies—those sorts of issues.

Senator RHIANNON: Do we take from that that it is more the mechanical issues that you are yet to work out and that there is agreement in principle that we should join?

Mr Fisher : We still have to provide advice to our minister, and that decision has not been taken yet.

Senator RHIANNON: When you talk about 'internal consultation', you are talking about with other departments?

Mr Fisher : Both with other departments and internally within DFAT.

Senator RHIANNON: Have you considered that some may conclude from the slow progress that DFAT is making on the Voluntary Principles that the Australian government is quick to promote mining overseas but takes a very long time to conclude voluntary guidelines on security and human rights?

Mr Fisher : No, I would not draw that conclusion.

Senator RHIANNON: Considering that the Australian government has been promoting mining interests in countries of Africa, what level of priority has this been given within DFAT?

Mr Fisher : It is a priority—there are clearly many priorities within DFAT, including corporate social responsibility and the sorts of issues that the voluntary principles advocate. It is a priority.

Senator RHIANNON: It is a priority?

Mr Fisher : It is a priority—one of many.

 

 

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