Chapter 1
Introduction
1.1 On 26 June 1996, the Senate referred the proposed abolition of the
Development Import Finance Facility (DIFF) scheme to the Committee for
inquiry and report by 20 August 1996. The reporting date was subsequently
extended to 17 September 1996 and then to 15 October 1996.
1.2 The inquiry arose out of a decision by the Minister for Foreign Affairs,
Mr Alexander Downer, MP, on 8 May 1996 to terminate the DIFF scheme from
1 July 1996. The termination of the scheme had been foreshadowed by the
then Shadow Treasurer, Mr Peter Costello, MP, in a press release entitled
Meeting our Commitments on 15 February 1996 during the election campaign.
[Contents]
1.3 The Committee advertised the inquiry in The Australian on 29 June
1996 and in The Australian Financial Review on 1 July 1996, calling for
written submissions to be lodged by 22 July 1996. The Committee also wrote
to Australian Government Ministers whose departments and agencies were
involved or had an interest in the administration of the DIFF scheme,
and to a number of industry, aid and environmental groups and individual
companies which had interests in the scheme, seeking written submissions.
The Committee received 60 submissions, which included one confidential
submission. Copies of non-confidential submissions were made available
on request and are listed in Appendix 1.
1.4 Although the Committee wrote to Mr John Moore, MP, the Minister for
Industry, Science and Tourism seeking a submission from his department,
the Minister replied stating that his department would not be making a
submission. The Committee considered, however, that the Department of
Industry, Science and Tourism (DIST) and the Export Finance Insurance
Corporation (EFIC), which is part of the same portfolio, had a contribution
to make to the inquiry. DIST is the department responsible for industry
matters and represented Australia at meetings of the OECD Development
Assistance Committee and EFIC has been an integral part of DIFF funding
arrangements. The Committee therefore requested officers of the Department
and EFIC to give evidence at a public hearing. At the hearing, the Department
was asked whether it had been directed by the Minister not to make a submission.
DIST Deputy Secretary, Mr Robert Trenberth, replied:
No. We took the view that there was little we could add to the
input you would get from the Department of Foreign Affairs and Trade
and AusAID. It flows from the principle I have just enunciated: while
there are industry elements and industry issues associated with this
scheme, we see it principally as an aid program. [1]
1.5 When asked whether the Minister advised the Department in any way
on this matter, Mr Trenberth said 'I am not sure; I do not know.'
At the request of the Committee, he took the question on notice. In a
letter dated 13 September 1996, DIST informed the Committee:
With respect to the question of whether the Minister advised
the Department, the opposite is in fact the case. The Department recommended
to the Minister that a submission not be made. The Minister accepted
this advice and wrote to Senator Michael Forshaw, Chairman of the Foreign
Affairs, Defence and Trade References Committee, advising that the invitation
to make a submission would not be taken up.
1.6 Public hearings were held in Canberra on 6, 7, 8 and 19 August 1996.
A list of witnesses who gave evidence to the Committee, and the dates
on which they were heard, is set out in Appendix 3. Officers of AusAID
and the Department of Foreign Affairs and Trade gave evidence in four
separate sessions over the first three days of hearings. All evidence
was taken in public session. Witnesses were sent copies of their evidence
and Hansard transcripts were otherwise made available on request.
1.7 The Committee invited the Minister for Foreign Affairs to give evidence
at a public hearing but the Minister refused to accept the Committee's
invitation. The Committee noted that the Minister did not reply until
19 September 1996, which was two days after the Committee was due to report
to the Senate had not the further extension of time been granted by the
Senate.
1.8 Senator Cook distributed a questionnaire to companies and business
organisations which had made submissions to the Committee. The purpose
of the questions was to obtain answers to a number of standard questions
which he would otherwise have asked at the public hearings. This procedure
saved considerable hearing time. It was also designed to enable the Committee
to compare answers submitted by a range of companies and organisations.
The companies and organisations which responded to the questionnaire are
listed in Appendix 2.
1.9 The Committee wishes to acknowledge the co-operation and assistance
of all individuals and organisations who participated in the inquiry,
in particular those who appeared at public hearings and gave oral evidence.
The Committee particularly wishes to thank officers of AusAID and the
Department of Foreign Affairs and Trade for their assistance and co-operation
throughout the inquiry.
Footnotes
[1] Committee Hansard, p. 499.