WA Inc: why the ALP was 'good for business'

April 17, 1991

By Tracy Sorensen

Once the royal commission hearings began on March 12, it didn't take long for the WA Inc fiasco to break loose from the state government's damage control mechanisms and start running wildly in the direction of Canberra.

As scandals go, this one is shaping up to be a whopper. There are enough millionaires, politicians, lies, bribes, secret deals, shady corporate schemes and briefcases bulging with cash to form the basis of a dozen bad television dramas.

Did Hawke give an undertaking to filthy rich ex-showground boxer and "colourful racing identity" Laurie Connell that there would be a three-year moratorium on the introduction of a gold mining tax in exchange for a $250,000 donation to the ALP? That's the question that had Hawke emmming and errring through a very uncomfortable week in parliament.

The federal government's attempt to distance itself from the WA mess took a severe beating from revelations that total funding for the ALP '87 federal election campaign amounted to at least $950,000 from the now collapsed, discredited and fugitive WA ex-tycoons.

And this is only the beginning. Labor's erstwhile mates have nothing to lose (Laurie Connell is reported to be mucking out the stables of his six remaining polo ponies himself), and some of them will be more than willing to drag others down with them.

Meanwhile, we are being treated to an excellent overview of the way politics and business were done in this country during the '80s.

WA Labor's favours to big business were stupendous. Some of these amounted to outright gifts of millions of dollars to people who were already disgustingly rich. But it didn't stop at favours. Through a series of specially created boards and commissions (such as the WA Development Commission) to which he shamelessly appointed his friends and relatives, Burke managed to entwine the state's finances with the fortunes of the men "active in the business community" at the time.

The bull market was running at full pelt, and the nouveau riche were more "active" than ever before. Tall office blocks mushroomed in the central business district. A monument to architectural tackiness, the Burswood Island Casino, was born. The old port city of Fremantle became the brash "Home of the America's Cup".

Meanwhile, there were the telephone calls and long lunches with Laurie, where Burke sought advice and made deals.

And what deals! The West Australian reported in December 1988 that Connell had sold his interest in the planned (i.e., non-existent) Petrochemical Industries Company Ltd (PICL), only to buy it back again a few months later for $5000. A few months after that, a government-Bond Corp consortium bought the interest for $350 million — netting Connell a profit of 7 million per cent.

Hardly surprising, then, that Connell agreed with the royal commissioners that Burke's government was "good for business", and that a few hundred thousand dollars (secretly) thrown the way of the ALP might keep things sweet.

Parliament took on less meaning than ever; everything was being run by an "elite of the able", a select group of people "in the know". The Legislative Assembly sat for only about half the time it had previously. Terry Burke, the premier's brother, resigned from parliament and started a much better paid career as a fundraiser for the ALP.

Burke friends and supporters Len and Brenda Brush were generously rewarded. Len the accountant was appointed head of the increasingly powerful State Government Insurance Commission, while Brenda embarked on the briefcase-full-of-dollars stage of her career as Burke's private secretary.

The SGIC, in tandem with Bond Corp, took over WA's only daily newspaper, the West Australian. Other than occasional forays into investigative journalism, the paper was not, during this period, known for its critical stance. Martin Saxon, who wrote the PICL story, had his home and office broken into the day after one of his articles appeared.

Darcy Farrell, Burke's old chief of staff from his journalism days at Channel Seven, got more than a bit part in affairs of state. In one big corporate change of hands, he acted as financial adviser to both buyer and seller. During a police investigation into alleged corporate fraud involving curious government-business ventures, Farrell was appointed to head media relations for the police. News about the progress of the investigation was therefore filtered through him.

By its very nature, WA Inc stood or fell as one piece. When the stock market crash came in October 1987, the government was set to fall along with its pumped-up pack of high-fliers. For Burke, the only way to hang on to office was to continue to prop them up, at whatever cost. With generous applications of taxpayers' money, he staved off immediate disaster. But now he was balancing on a pack of shaky cards. Ireland began to beckon. n

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