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Grand corruption? Sir Mek's hard questions about Paladin contract

Grant Hehir
Grant Hehir -  leading the inquiry delving deep into possible corruption in PNG and Australia in the Paladin Manus  detention centre contract


PORT MORESBY – Former prime minister and MP for Moresby North-West, Sir Mekere Morauta, says an Australian government inquiry into the granting of contracts relating to the Manus detention centre should consider the possibility of official corruption involving senior Papua New Guinean politicians and bureaucrats.

The inquiry, being conducted by Australia’s auditor-general Grant Hehir will cover all aspects of government contracts for Manus and Nauru and will report next year.

Sir Mekere said anecdotal evidence suggests Australian taxpayers’ money may have been secretly used as slush funds to prop up the prime ministership of Peter O’Neill.

“It seems clear the PNG government put pressure on the Australian government and department of home affairs to appoint Paladin as the garrison services and security contractor for Manus,” Sir Mekere said.

“This raises very serious questions – why Paladin, which was a tin-shed company with almost no paid-up capital? And who from PNG was applying the pressure?

“Since the contract was awarded it has been revealed that companies associated with Mr O’Neill’s People’s National Congress party are beneficiaries.

“Mr Hehir should investigate whether Mr O’Neill, or staff from the PM’s office and public service cronies, were involved in putting pressure on Australia and whether they benefitted in any way from the contracts.”

Sir Mekere asked whether chief secretary Isaac Lupari or the PM’s media spokesman Christopher Hawkins involved in any way.

He said it had been reported that Lupari asked Paladin for a ‘donation’ of K20 million soon after it won the contract and that, when the company did not comply, it found that staff and executive visas were refused and that other action was taken against it.

Sir Mekere said it was also notable that there were similarities in background between the principals and executives of Paladin and Hawkins: extensive experience in the Australian Defence Force and Reserves and periods of employment in Singapore and Timor.

Paladin is based in Singapore and has operations in Timor, and its executive and staff include Australian and foreign ex-military personnel, including director Craig Thrupp and CEO David Saul.

“Mr O’Neill should come clean on any dealing with Paladin by himself, Mr Lupari and Mr Hawkins,” Sir Mekere said.

“It should be of interest to the Australian auditor-general if the tender process was perverted in PNG to the detriment of Australian taxpayers.”

Sir Mekere said that another ‘coincidence’ that needs e investigation is Paladin’s recent purchase of the Black Swan security company, which has many government security contracts and has long been publicly associated with O’Neill.

“The details of the purchase and the associated financial transactions might prove fruitful avenues of inquiry,” he said. “The purchase may have been a convenient way of transferring money to other parties.

“There is also the question of timing. Why the rush – did it have anything to do with the fact that Mr O’Neill had just been re-elected prime minister?

“And why Paladin, which, by the time the contract was awarded, had developed very close ties to PNC and the government?

“We know that claims by Australia’s home affairs minister Peter Dutton and his department that ‘no-one was interested in bidding for the contract’ are not true.

“This was the reason Mr Dutton gave for using ‘special measures’ to ensure Paladin was the only possible candidate.

“But we know that Toll, Serco and a local company Loda Security, all of which had Manus experience, were preparing to bid. But suddenly Paladin was hand-picked by Mr Dutton and his department.”

Sir Mekere also drew attention to the K1 billion value of the contract in light of Australian Financial Review estimates that Paladin’s monthly costs were K7 million from total monthly contract payments of K34 million.

He said auditor-general Hehir should follow the money trails to ensure every cent of Australian taxpayers’ funds was spent and acquitted appropriately, especially in PNG, which under O’Neill is one of the most corrupt regimes in the world according to Transparency International.

“Specifically, the inquiry must establish whether any PNG laws have been broken under these Australian contracts, not just Australian laws,” Sir Mekere said.


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Simon Davidson

The inquiry should put the spotlight those chipmunks, carpet beggars and fixers who work in the shadows and do shoody deal for their King and think they are hidden and untouchable.There should be no inference from these people, when the enquiry is carried out, so that these deluded puppets and would be kingamkers are exposed and dented.

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