The Shadow Minister for Defence Science, Personnel and Assisting Shadow Minister for Defence, Bob Baldwin, today called on the Auditor General to investigate recent reports of Defence awarding ‘phantom contracts’ worth millions of dollars.

Mr Baldwin said that the reports in today’s Sydney Morning Herald were of real concern given the extent of the reported largesse and because the expenses occurred during a time when the Rudd Labor Government was supposed to be finding $20 billion worth of savings from within the Department of Defence.

‘These reports are particularly galling since the Australian National Audit Office (ANAO) recently gave Defence a clean bill of financial health and unqualified financial statements for 2008/09,’ Mr Baldwin said.

‘I have written to the Auditor General expressing my concerns and have asked that he firstly investigates these reports and secondly moves to ensure that any such investigation includes an examination of contracting policy and practices in high-risk categories within Defence such as accommodation and travel.’

The phantom contracts are reported to include:

·      $37,000 for a tourism company that specialises in providing horse riding

·      $30,000 on ‘stuff’

·      $33,000 for hiring a Lear jet – which the company has no record of

·      $12,100 on accommodation in Canberra – which the company has no record of

·      $250,000 for one night’s accommodation at the Hyatt Regency Hotel in Adelaide – a contract that the hotel has no record of

Mr Baldwin said that today’s revelations were symptoms of a department suffering from poor ministerial oversight.

‘While these phantom contracts represent an outrageous waste of taxpayer money, the root of the problem can be traced back to a lack of ministerial oversight,’ Mr Baldwin said.

‘Minister Combet, who is responsible for the management of Defence contracts and the Defence Materiel Organisation, has been so preoccupied with cleaning up after Senator Wong and Minister Garrett that he has neglected his Defence responsibilities.’

‘Today’s reports make it clear for all to see that Minister Combet and the Rudd Labor Government are not taking the $20 billion Defence savings program seriously and are comfortable with the fact that their actions will result in future capability gaps and sub-par equipment for Australia’s troops.’