Julie Bishop wanted to to get out ahead of the PR surrounding her first post-politics gig — a board director role at international consultancy Palladium International.
After the outrage that followed Christopher Pyne’s stroll from the defence industries portfolio to advising on defence industries at EY, the former foreign minister had ample warning.
She managed the announcement via a front page interview with Jennifer Hewett at The Australian Financial Review. Indeed, she preemptively addressed the closest thing the story had to a tough question:
‘I am just pointing that out in the light of recent [pause] commentary,’ she says firmly. ‘I am obviously aware of the obligations of the ministerial guidelines and I am entirely confident that I am and will remain compliant with them.’
Bishop goes on to state her conviction that the private sector is the way aid ought to be administered, saying “I’ve long believed the private sector is the key to lifting living standards and economic development. It’s a long-standing personal interest of mine and working with a private company like Palladium will help me continue to work for opportunities in the Pacific and PNG.”
And certainly this preference was ably demonstrated during her time as foreign minister. Palladium, which works on international development projects and strategic advice for governments, companies and NGOs, receives hundreds of millions of dollars annually in funding and benefited greatly from Bishop’s time in office.
Labor Senator Penny Wong has already pointed out that this may well breach ministerial standards, as well as the (equally unenforceable) pub test:
‘She has been put on the board of a company that profited on decisions made when she was Foreign Minister,’ Senator Wong said. ‘Second, she has said she has been appointed in part, for example, for her extensive network of global contacts.
‘Now, the ministerial code says very clearly you can’t use information, knowledge, et cetera, that you have attained as a minister that is not available to the general public [and] I think the statement by Palladium Ms Bishop has been appointed because of her unique knowledge.’
Ministerial standards
As Wong alluded to, during Bishop’s five years as foreign minister, Palladium received hundreds of millions of dollars in federal funding. Indeed, Palladium is one of four private contractors to primarily benefit from changes undertaken by the Abbott government in 2014, when DFAT and AusAID were merged. Between 2013 and 2017, they received nearly $4 billion from the aid budget.
This raises the broader story of the percentage of aid going to an ever-shrinking group of large managing contractors like Palladium.
“Boomerang” funding
Back in 2011, then-foreign minister Kevin Rudd launched a review of the effectiveness of foreign aid, with specific focus on the issue of “boomerang aid”. It’s a term that refers to the huge proportion of foreign aid that went straight to Australian and international contractors, rather than providing on-the-ground assistance in the countries themselves. The review advocated reducing the proportion of aid delivered by private contractors, in favour of multilateral organisations like UN agencies or the World Health Organisation.
The 2014 merger of AusAID and DFAT was criticised as sending aid spending “further down the path of operating primarily in the national interest”. Indeed, at the time Bishop said that “DFAT will have a clear focus on promoting the economic interest of the Australian people and Australian businesses”.
Since then, the focus of aid spending has reversed, with more money paid to private companies and less to multilateral organisations.
At what cost?
The Development Policy Centre at the Australian National University runs a stakeholder survey every three years, and in 2018 found that the majority of those implementing aid programs — both private sector contractors and NGO executives — agreed that the emphasis on “facilities” (the large, multi-faceted programs run by consulting or contracting companies like Palladium) in the management of Australian aid has had a negative effect on the quality of that aid.
Further, in a submission to a parliamentary inquiry into the effectiveness of Australia’s aid programs last year, the Lowy institute’s Pacific Islands program director Jonathan Pryke argued the Abbott government’s overhaul had “come at the cost of the aid program’seffectiveness”:
The Australian aid program has always relied on the private sector and consultants to varying degrees to supplement and provide as-needed independent reviews and assistance on project design. However, the volume at which this is happening under DFAT needs to be reviewed, and the department’s in-house capacity needs to be rebuilt so that the it does not run the risk of outsourcing its brain.
Does Australia’s aid program need a shakeup? How do we stop the revolving door of cushy post-parliament jobs? Send your thoughts along with your full name to boss@crikey.com.au
This whole scenario is outrageous. This is taxpayer’s money being handed out to private companies supposedly for ‘foreign aid’, when we don’t know how much of said money is going back to these company share holders…and to high profile ‘recruits’ like Julie baby.
What the hell is wrong with the Oz voters that they think this type of behaviour is in any way acceptable???
It was ever thus.
I worked as a volunteer with AusAID for almost a decade and followed the aid debates closely. From October 2013, when Abbott closed AusAID and its assets were stripped by DFAT, the Australian aid budget declined sharply. Whenever an article appeared commenting on this decline there would be a host of comments from those who opposed aid and said that Australia has many poor people and the money should be going to them. Of course the money stripped out of aid never did go to the poor or homeless in Australia.
“… agreed that the emphasis on “facilities”… in the management of Australian aid has had a negative effect on the quality of that aid.” D’oh!
The sort of gig you’d expect from someone who :-
Flew around the country on the Magic Public Purse to see her Eagles play – “coinciding” with arranged “government business”?
Who misled parliament over Man Monis’ correspondence with Brandis’ A-G’s Dept.
Who, with Scumbo, arranged for the transportation, back to Sri Lanka, of Tamil refugees fleeing government persecution and genocide.
And who did so well as “Minister for Pissing Off China”.
At the risk of being boring, I repeat what I wrote yesterday “nothing will come of our cries of outrage because there have been too many before Pyne. And why would pollies vote to cut off this lucrative avenue at the end of their “service” to the public.”
Someone has to pay for Julie’s wardrobe and earings. Why not Foreign Aid? I’d like to know how much profit Palladium makes from distributing our aid, probably not enough for them to have to pay tax, It’s just another trough.
Exactly. Australia’s “foreign aid” has, for some time now, been much more about delivering benefit to Australian companies and consultancies, than those pesky needy foreigners. And, given that our neocon government keeps reducing that “foreign aid”, we can only presume that even more goes to those companies, and even less to those in need.
The only surprise is the, apparent, surprise that Lady Penelope Asbestos continues to do well – for herself.