What did Sinodinos, Packer and O’Farrell chat about at Rockpools? Greens’ Kaye hits a nerve

SINCE I POSTED THIS STORY TODAY, NSW PREMIER BARRY O’FARRELL HAS RESIGNED. THE CASINO QUESTIONS ARE MORE RELEVANT THAN EVER. IT’S TIME FOR POLITICIANS TO START ANSWERING OUR QUESTIONS.

For a party that was swept to power on a platform of anti corruption and transparency, the NSW Liberal Party is looking very  grubby today. If the people of NSW decide it’s business as usual, one could hardly blame them.

This post brings readers up to date with an earlier story about an interesting lunch at Rockpool’s between then NSW Party Treasurer Arthur Sinodinos and James Packer about two months before Packer launched his carefully prepared successful campaign for his controversial Barangaroo Crown casino in February 2012. NSW Premier Barry O’Farrell and his then chief of staff Chris Eccles were reported to have bumped into the two men at the restaurant. The question is: what did they talk about? Did this relate to the casino or any other NSW business deal? Were donations or other favours mentioned?

When Senator Arthus Sinodinos stood aside as Federal Assistant Treasurer after he became embroiled in the current NSW Independent Commission against Corruption (ICAC) investigation into Australian Water Holdings ( AWH), a memory of the lunch niggled at me. It that had been briefly mentioned by the Daily Telegraph back in 2012.  This and other opportunities for conversations about the deal became even more relevant after information about political donations from Crown Entertainment and Ros Packer to the NSW Liberal Party later emerged. ( see my earlier story).

I was worried by how Premier O’Farrell avoided any detailed scrutiny of the government’s immediate support for the project and his own dealings with Packer. He sidestepped questions by saying in February 2012 that whenever he met Packer, they discussed the casino. I wrote about this in New Matilda in 2012 when O’Farrell refused to answer our questions. The casino that many opposed was made to seem like a fait accompli from the time it was announced.

Greens MLC John Kaye has since taken up this issue in the Legislative Council.  I will return to his questions soon but firstly, here is some current context.

Yesterday, O’Farrell gave evidence at the NSW Independent Commission against Corruption in the final session of its investigation into infrastructure company Australian Water Holdings (AWH), its attempts to secure NSW government contracts and links to notorious corrupt ex Labor government Minister Eddie Obeid. O’Farrell’s appearance at the Inquiry was not originally planned but evidence that emerged last week left ICAC with no choice.

Evidence was given that then chief executive of Obeid-linked infrastructure company Australian Water Holdings, Nick Di Girolamo, sent Mr O’Farrell the $2978 bottle of Penfolds Grange in mid April 2011. The wine gift and other entertainment expenses associated with the Premier were recorded in company records. Around the time of the alleged arrival gift arrived at his home, O’Farrell made a short phone call to Di Girolamo, who told the Commission that this was his thank you call. O’Farrell denies ever receiving the gift and did not record it on his pecuniary interest register as is required. He denies making the thank you call.  Di Girolamo has now returned to the witness box.

Ex Finance minister Greg Pearce gave evidence last week that in May 2011 he had been called up like a naughty “schoolboy” to O’Farrell’s office where Di Girolamo was meeting with O’Farrell. Pearce was surprised at how close a the meeting between the Premier and Di Girolamo appeared to be.  A text message from O’Farrell to Di Girolamo in August 2011 has been tendered saying that the Premier is “appalled” at the treatment of AWH and “we are on to it”. The two men sent texted each other on other occasions.

At best, the picture that emerges of NSW a familiar one of favours, meetings, cosy talks in pursuit of government decisions that favour business mates.

O’Farrell’s approach up until now has been to fend off questions and stand indignantly on the high moral ground. As Andrew Clennel wrote in the Daily Telegraph today when O’Farrell’s meeting with Di Girolamo was revealed , O’Farrell announced:

“There is no problem having meetings with people, the problem is the actions that are taken after those meetings,” O’Farrell railed. “This state has scandal starvation. There is no story here and no splash here because the work has not been done.” Whatever his hopes that the scandal would go away, there is certainly a story now.

O’Farrell’s retort to uncomfortable questions is a classic tactic. Political opponents and journalists who think there is more to probe would not take them too seriously.

This brings me back to the lunch I reported in this blog several weeks ago.

I drew attention to a Senator Arthur Sinodinos lunch with Jamie Packer at Rockpool restaurant in December 2011, not long before Packer was going to launch his long planned campaign for his Sydney Crown casino.

Greens  MLC John Kaye who has consistently campaigned against the casino deal followed up the issue in the NSW Legislative Council.  The question struck a nerve and the answer opened up more questions.

 JOHN KAYE: My question without notice is addressed to the Minister for Police and Emergency Services, representing the Premier.In December 2011, did the Premier and Mr Chris Eccles, while eating at the Rockpool restaurant, happen upon Mr James Packer, who was eating at the same venue with then Liberal Party Treasurer and Senator Arthur Sinodinos? If so, what matters were discussed and at any stage during the conversation were either of the following topics discussed: first, campaign donations and, secondly, Mr Packer’s proposal for a gambling facility or second casino?

The question caused a mild uproar.

After order had been restored, Gallagher’s  (representing O’Farrell) first approach was to attack the questioner. “What an absolutely stupid question. I am sorry, I should have said that it is a good question from a stupid member.” Kaye then objected that Gallagher should answer not debate the question.

Gallagher:

I will not give that question any more attention, and I do not believe it actually deserves any. I do not know where the member who asked the question gets his information from.

Liberal MP Catherine Cusack then came to Gallagher’s defence suggesting that he should ask Kaye a question. Gallagher responded:

No-one is interested in what Dr John Kaye does—or where he eats, who he eats with or who he knows. He stands in this place and makes such an allegation as though it is gospel, and we are supposed to accept it. I do not know and he does not know.

Kaye: I asked you a question.

Gallacher : And I am answering it.

Kaye:So are you saying that he did not meet with him?

Gallagher :I do not know.

Kaye:Is that what you are saying? Are you denying that he met with him?

Gallagher: I rest my case on the last interjection. It is pretty clear that the member does not want an answer, because he does not seek one. He simply wants to make an allegation and put it on the record.

Kaye: I ask a supplementary question. Will the Minister elucidate his answer by explaining whether Mr Eccles and the Premier, while eating at the Rockpool restaurant in December 2011, happened upon Mr Parker and Senator Arthur Sinodinos?

 

The supplementary question was ruled out of order.

About 30 minutes later, Gallagher changed his tune.

Gallagher:

Earlier in question time I was asked a question by the Hon. John Kaye regarding the Premier’s dining arrangements. I refer the member to a letter in the Daily Telegraph Letters to the Editor column on 27 October 2012 entitled “Clearing the air”, which stated:

 

The Daily Telegraph reports correctly that my Director General and I ran into James Packer at a restaurant in December last year. As your journalist was told when he raised the encounter, James Packer did not mention anything to do with his current Barangaroo proposal.

That short letter was written by Barry O’Farrell, Premier of New South Wales. I had not known of O’Farrell’s reply when I made my earlier post. As I said, O’Farrell declined to answer any of our questions in 2012.

I asked Kaye how he responded to the reply. He answered: “Minister Gallacher’s responses open up more questions than they answer.

“The Minister neatly avoided the issue of any discussions of campaign donations and left the public hanging on what actually was discussed.

“Given the timing of the meeting and Mr Packer’s obsession with his casino proposal, it is quite extraordinary that the Baranagroo project was not discussed. It’s my guess that it would have been one of the only conversations Packer had with anyone in that entire year where he didn’t raise the casino issue. The level of abuse in the Minister’s first response is convincing evidence that we were getting very close to the bone.His second response and its failure to even mention campaign donations suggests that more questions should be asked,” Kaye said.

Back in February 2012, O’Farrell said that ”just about every time I see Mr Packer he expresses interest in running a casino in Sydney and offers other suggestions on boosting tourism.” So if this was an unusual occasion in which the casino was not discussed, what was discussed – donations? I wonder why Gallagher failed to respond to the part of the question about donations.

Another indirect connection with Packer has come up at this inquiry.  Eddie Obeid’s son Eddie Obeid Jnr who worked at Australian Water Holdings also arranged a breakfast meeting between Senator Sinodinos and Karl Bitar. Bitar like Sinodinos was a party apparatchik who resigned as ALP national secretary in March 2011, joininh a long line of Labor leaders men who went to work for the Packer Family. Sinodinos, Bitar and Obeid met in the Four Seasons Hotel on July 12, 2011. “It was a general discussion. Arthur and Karl always wanted to make acquaintance. It was a general sort of catch-up,” Obeid told the Inquiry said. I wonder what matters were canvassed in the “general sort of catch-up?”

Deal making in NSW crosses political party boundaries. Business mates use entertainment, donations, jobs and lobbying to tap into both major parties. Packer has amassed an impressive display of political contacts across both parties. ( See New Matilda’s 2012 report of Team Packer. This is partly why it’s not at all surprising that O’Farrell rather than offering a bright clean future for NSW ended up being the fourth NSW Premier to appear before ICAC. The Inquiry continues today.

I’d still like to know about the topics of conversation at that December 2011 lunch. It would also help transparency if NSW politicians could treat parliamentary and journalists’ questions with less arrogance.

Packer and Sinodinos – an intriguing Rockpool lunch

There’s a small issue that has been niggling at me all week. It’s about Sinodinos and Packer.

It was December 2011 and the scene was Sydney’s high class Rockpool restaurant. Senator Arthur Sinodinos and casino tycoon James Packer were having lunch. Sinodinos had just become a Senator and was Treasurer of the NSW Liberal Party. James Packer was on a mission to achieve his lifetime goal – a Crown casino in Sydney to add to his Perth, Melbourne, and Macau gambling meccas.

Sinodinos was Assistant Treasurer in the Abbott government until he stood aside this week while the NSW Independent Commission against Corruption (ICAC) continues its inquires into Australian Water Holdings (AWH). Sinodinos was a director of AWH during a period when the company made a number of donations to the Liberal party.At the time AWH was seeking a lucrative deal with the NSW government. Sinodinos, who stood to make millions if the deal had been successful., has yet to give evidence at the ICAC inquiry. He has denied any wrongdoing.

But back to that pre Christmas 2011 lunch. Two other men were also in the restaurant, NSW Premier Barry O’Farrell accompanied by his Chief of Staff Chris Eccles. The two lunching partners came across each other and not for the first time, Packer raised his new casino plan with O’Farrell.

I owe my information about this intriguing story to Daily Telegraph political reporter Andrew Clennell’s who mentioned the meeting of the heavy hitters in passing in his column nearly a year later in October 26, 2012. As far as I am aware it has not been raised since. By the time Clennell published his column, the casino had won the support of both the NSW Liberal and Labor parties and was all but a ‘done deal’. O’Farrell had given the deal his backing and Chris Eccles had signed off on it. The bipartisan support demanded by Packer fell into place when the NSW Shadow Minister for Infrastructure Luke Foley endorsed the proposal, on the condition that there should be no poker machines in the new casino. Only the Greens were in clear opposition.

But the really interesting questions now are:  What did Sinodinos and Packer talk about at the lunch ? The casino? – we already know that was a topic of conversation. When Packer raised the casino with O’Farrell – what did he, Eccles and Sinodinos say? Was Liberal party fundraising? It seems hard to believe that Packer and Sinodinos  wouldn’t have discussed Liberal Party fundraising. Who else did Sinodinos speak to about Packer’s casino deal? Did he have other conversations with Packer, O’Farrell, Eccles, Crown Board member and Sinodinos’s predecessor in the Senate  Helen Coonan, or anyone else about the casino? Had Sinodinos or Eccles told O’Farrell that Packer would be in the restaurant?  Were donations to the Liberal party discussed with Packer or his employees or lobbyists on this or other any other occasion?

Arthur Sinodinos – Background

Arthur Sinodinos has been regarded as a Liberal rising star. He was Prime Minister John Howard’s Chief of Staff from 1997 -2006 after which he worked for Goldman Sachs and the National Australia Bank.

There are few who can match his Liberal Party insider connections. Sinodinos got out of Canberra before the Liberal party was defeated in 2007 and in the dark years between 2009 and 2011. Sinodinos  became Finance Director of NSW Liberal Party. Later In 2009, while working for the National Australia Bank, he became vice president of the Federal Liberal Party, bringing what supporters hoped would be business support to the party.

Abbott and Sinodinos are close. They have been allies in the faction ridden NSW Liberal party. In 2010 and early 2011, the Sydney Morning Herald reported that Abbott was involved in factional battles to support fellow right winger Sinodinos for the NSW Liberal Branch Presidency. In June 2010, Sinodinos was reported to be very regularly talking to Abbott.

Consider this short timeline and sequence of events, some of which were described by Lawrence Bull and myself in a series for New Matilda in 2012

May 2011: The ex-general secretary of the ALP and Giillard’s campaign director in the 2010 election, Karl Bitar joins Packer’s Crown Casino company. Crown announced that he would be ”responsible for managing Crown’s relationship with the Federal Government across a broad range of issues”

July 12,  2011: Arthur Sinondinos meets Karl Bitar at the Four Seasons Hotel in July 2011.  (This evidence is part of documents tended at ICAC. Eddie Obeid junior went along too. We’ll be hearing more from ICAC about the Bitar connection with Sinodinos and the AWH story).

August 2011:  Minister for Communications Helen Coonan resigns from the Senate and a few days later she joins the Board of Packer’s casino company Crown Ltd. For her duties she is  paid about $116,000 a year, as well as receiving complimentary access to Crown facilities in Melbourne and Perth. At the time of her appointment, Independent Senator Nick Xenophon told Fairfax reporters, “It’s sad to see that someone with such a distinguished career in public life will become part of an industry that causes so much misery in the community.” World Vision CEO Tim Costello commented on her “indecent haste”. Helen Coonan also becomes a political lobbyist.

October 2011: Arthur Sinodinos is selected by the Liberal Party to replace Helen Coonan in the Senate.

December 2011: Sinodinos and Packer have lunch.

24 February 2012: James Packer is ready to hatch his new casino plan. His chosen method was an exclusive interview with Australian Financial Review.When asked about his communications with Packer, O’Farrell said “just about every time I see Mr Packer he expresses interest in running a casino in Sydney and offers other suggestions on boosting tourism.”

2012-2013: The biggest donor to the Liberal Party in 2012/13 was James Packer’s mother Ros Packer. She gave $ 570,000, far more than the $11,000 she gave the NSW Liberal Party in 2007/8. Between 2011 and 2012, Crown Entertainment also gave $40,000 to the Federal Liberals.

February 26, 2012 : Two days after Packer announces his planPremier O’Farrell and Treasurer Mike Baird back Packer’s casino plan. Critics note how quickly they have announced their support.  

February 27, 2012: Labor right wing heavy, kingmaker and former treasurer Mark Arbib quits the Senate.

June 2012: Packer recruits Arbib to his private company Consolidated Press Holdings.

From 2011 onwards the most vocal public critic of Packer’s proposal was NSW Greens MP John Kaye, who voiced his concern about the government’s rapid embrace of Packer’s plan. “This is going to be a test for the state government,” he told The Australian. “Are they going to stand up to Packer, or will they do what they always do with multi-billionaires and let them have what they want?”. Kaye told New Matilda that he was appalled that normal legal and planning processes were being subverted by O’Farrell’s handling of the proposal.

The casino deal was highly unorthodox. By locking in media and political support, Packer made its approval seem inevitable. Aside from reporting by the SMH especially reporter Sean Nicholls, there was little rigorous examination of the means by which Packer achieved such favourable conditions for the processing of his so-called gift to Sydney. Crown placed 18 full page ads in News Ltd publications and the Australian Financial Review. The Age and SMH, some of whose journalists had been critical of the proposal, were not included. Packer told the Australian he regarded some SMH journalists as “pissants“.

In September 2012, New Matilda was trying to get Premier O’Farrell to answer our questions about his knowledge of and meetings about the Packer’s casino. We got no answers. The day we published our questions, Andrew Clennell published his intriguing mention of Arthur Sinodinos. I noted it at the time but I’m even more intrigued now.

Sinodinos too has managed his personal media relations well. He has had remarkably little critical coverage until the Australian Water Holdings story and his link to notoriously corrupt power broker Eddie Obeid becamr public. This was partly because he was not only a political insider but a media insider as well. He was on the News Ltd payroll as a regular columnist in 2010. In this role, he promoted Tony Abbott, on one occasion reassuring readers that the leader was now ‘comfortable in his skin’. (5/1/2010). Meanwhile in the same publication, fellow columnists promoted Sinodinos as a future parliamentary talent ( e.g. Peter Van Onselen 17/1/2010). Fairfax made him a judge of AFR’s 2009 List of the Powerful. He’s often been used as a commentator by Radio National.

Fellow Newscorp columnist Christopher Pearson who had since died described him as a ”remarkably selfless individual, loved or respected across not just the Coalition but the entire political class.” That now seems a little generous.

Now that Sinodinos is looking a little bit grubby as journalist Jack Waterford said on Radio National, I am hoping we may hear more of his dealings with Packer and how those were related to Liberal party donations and the casino deal.

 Note: In 2012, New Matilda developed its Team Packer list.

If you see anything here which is not accurate or if you have more information please contact me or leave a comment.

Since this article was first published in the morning of March 23. Minor corrections and editing changes were made on March 24 and small adjustments to the questions

 

 

 

 

Fairfax smoozing Packer puts independent journalism under pressure

Fairfax’s SMH journalists have been amongst the few to probe the NSW O’Farrell’s government backing of James Packer’s plan for a new hotel casino in Sydney. Reporter Sean Nicholls broke a story about how the government had changed the rules for “unsolicited proposals” in a way that made it easier for Packer to avoid a competitive tender. So I was shocked when I opened the SMH on Saturday and found a plug for a story by Packer pitching his casino plan labelled as an ‘exclusive’ and ‘news’. There were several independent reports inside the paper, but online, Packer’s free promo was number three while other pieces were buried further down the page.

I am not suggesting that SMH should refuse to publish an opinion piece by Packer but this incident which followed Fairfax’s Australian Financial Review’s pushing of the plan through exclusives and a recent AFR business dinner at which Packer was the keynote speaker.

Concerned about the possible threat to independence of reporting, I wrote another piece for New Matilda:

Packer’s PR Coup

Packer’s Casino Present

In late October, New Matilda began our series on James Packer’s proposal for a new casino in Sydney. I worked on this series with Lawrence Bull.

Through its media management strategies and political networks across the NSW Liberal and Labor Parties, Packer had been able to make his casino seem like a foregone conclusion. He has achieved first stage approval for a second casino in NSW from the Premier Barry O’Farrell without any independent or public scrutiny.

The deal however has not yet been finalised. Casinos require licenses for which owners pay fees and taxes on turnover and there are processes for checking to see whether those proposing to run them can pass a “fit and proper test” and financial scrutiny. But the NSW government led by Barry O’Farrell is planning to by pass these laws and work through the ‘unsolicited proposals’ procedure which avoids a debate about whether the community wants another casino or not. O’Farrell has appointed ex head of the Commonwealth Bank David Murray to examine the proposal in the second stage of the approval process. It is very likely there will be allowance for public submissions. Public submissions would be allowed if the procedures set down the NSW Casino Control Act were followed.

Packer’s proposed hotel with casino is part of Barangaroo, a huge Lend Lease development on publicly owned land near old Sydney docks. The likely site is on what is known as Barangaroo South where it would be built near the water, along six three commercial towers and a residential development.

To really explain this story, we needed to provide some history rather than simply a blow by blow description of the game which clinched the deal.

The story goes back to the early 1990s when Kerry and James Packer were bitterly disappointed when they failed to win the tender for Sydney’s single casino. They kicked up a hell of a ruckus and got some help from the Labor party but couldn’t win over the Casino Control Authority which had been set up to regulate the newly legalised casino industry. ( If you are interested in this aspect, read Paul Barry’s book, Who Want’s to be a Billionaire? )

You could say however that the story of Packer’s Liberal party links goes back even further than that to the days of notoriously corrupt Liberal Bob Askin government whose successful election campaign in 1964 was directly funded by James’s conservative grandfather, the media boss Frank Packer. Bob Askin used to play poker at Frank ‘s home. James’ uncle, Clyde, was a NSW MP.

Links between senior Labor figures and the Packer family are just as strong as Liberal ones.

In the first story, we look at how the impression that the second casino was a fait accompli has been achieved and review some of the relevant political background. There is also a chart showing the current shape of Packer’s complicated business empire. At the top of the Chart is Consolidated Press International Holdings (CPIH)  and behind that the family trusts where the private profits end up. Sadly we can’t tell you much more as the trusts are secret.

http://newmatilda.com/2012/10/25/packers-casino-game

We start the second story in February this year when James Packer’s announced that he proposed to ‘gift’ Sydney with a 6 star casino/resort on the public land part of Barangaroo. This announcement was made through an exclusive interview on the front page of the Australian Financial Review.  We look at how the Liberals and Labor locked in behind Packer.

http://newmatilda.com/2012/10/26/casino-macquarie-st-wants

Supporters of the casino repeat James Packer’s claim that his casino will be an economic winner for the people of NSW. But has anyone seen a copy of the Allen Consulting Group report on which he relies? As Greens John Kaye said in an interview I did with him,  consultants will come up with what is required and will limit their findings to what questions are posed. We wanted to know if Premier O’Farrell had seen a copy of the report at the time he endorsed the proposal, just two days after Packer had formally announced it. At the time, O’Farrell said that Packer had mentioned his desire for the casino on a number of occasions when they met. So when did the plan really get hatched? It could even have been back in the days of the Labor government which was repeated to be on the cusp of awarding Packer with a casino back in 2007. We’d like to know the answers to these questions, but unfortunately O’Farrell preferred not to answer them.

Why we posted the O’Farrell questions

I think that part of independent Journalism should let the public know when people won’t answer their questions. It should be part of the extra transparency offered by online publishing. So New Matilda published the questions. If you have any suggestions about how to get the answers put up a comment on New Matilda, or send me a direct message to call you via twitter @Wendy_Bacon or email to New Matilda or me at wendybacon1@gmail.com

Questions we put to O’Farrell

The Packers’ Liberal party links go back a long way but the family’s connections to Labor are just as impressive. We compiled a list of people in their current network across business, media and politics. You can also find out how much the Crown directors are paid. I was also struck although not surprised to see that they get free services at the Crown casinos in Perth and Melbourne. When you think about how much rooms and food might cost, this item alone could be worth many thousands on top of the annual income from directorships.

Team Packer

The next story in our series focused on how casino regulation is supposed to work in NSW and how O’Farrell’s plan to “get on with it” removes a lot of safeguards put in place to protect NSW against organised crime and corrupt influences which have a history of targetting casinos. If NSW wanted to have a new casino, the first move would have been to amend the Casino Control Act to make it possible to have more than one casino in NSW. At the moment only one is allowed. After that the procedure is set out very clearly in the Act. You call for expressions of interest, then hold a tender which involves detailed checking of applicants. The unsolicited proposals legislation raises risk of improper influence and has few of the safeguards in the Casino Control Act.

We also look at the the Independent Gaming and Liquor Authority‘s ongoing investigation into whether Packer’s company Crown should be allowed to raise its shareholding from 10% to up to 25%. Through a public submission, Stephen Mayne has raised some significant issues which he wanted the Authority to follow up during its inquiries.  There are lots of issues the inquiry could explore – but will they?

Red Tape cut for Packer 

Economists question Packer’s promised bonanza for NSW

This week, New Matilda continued our series on Packer’s proposal for a hotel with casino at Barangaroo South on the edge of Sydney Harbour. Lawrence Bull asked two economists what they thought of James Packer’s claim that his casino would deliver $400 million to NSW and they raised lots of questions:

Are casino benefits wobbly?