Article: Labor mates' linked to lucrative winning tenders

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From the Melbourne Age click here!

Labor mates' linked to lucrative winning tenders

Labor mates' linked to lucrative winning tenders
Melissa Fyfe
August 9, 2009

METRO Trains Melbourne's successful bid for the lucrative contract to run the city's trains may have had a distinct political advantage, despite strict probity rules covering the tender process.

The Sunday Age has learnt that the consortium employed the Enhance Group - the firm now at the centre of Queensland's lobbying scandal - to provide it with political advice. Enhance Group's Melbourne head, Tim Fawcett, who oversaw political and policy advice for the bid, is also vice-president of Labor's fund-raising arm, Progressive Business, as well as a former economics adviser to party heavyweights Simon Crean and Gareth Evans.

And just months before the tender was finalised, the controversial lobby group recruited Peter Marczenko, an adviser to Roads and Major Projects Minister Tim Pallas before he left to join Enhance in March.

Metro Trains Melbourne will take over the city's rail system in December from Connex - a contract estimated to be worth $8 billion over 10 years.

Last week it was revealed that lobbyists Philip Staindl, president of Progressive Business, former state Labor minister David White and former Bracks government adviser Danny Pearson provided political advice to the winners of the $3.5 billion desalination tender.

Mr Fawcett told The Sunday Age that the company did not lobby on behalf of the MTM bid, it only advised on policy matters, although he conceded that neither he nor Mr Marczenko had any background in rail. ''We provided advice on the Victorian Government transport policy and other relevant policies as they applied to the bid,'' he said.

The probity auditor was aware of Enhance's involvement, Mr Fawcett said, and the company adhered to strict guidelines, not meeting with any ministers, ministerial staff members or bureaucrats during the tender process. Outside the tender process, Mr Fawcett said he has the ''odd beer'' with ministerial advisers.

Mr Fawcett said Mr Marczenko played an ''extremely small'' role in the bid and when he employed the Government staffer he was unaware he had been working for Mr Pallas. Mr Fawcett said he knew only that Mr Marczenko had worked as a senior adviser to former industry minister Theo Theophanous.

Mr Pallas did not sit on either of the ministerial committees that gave final approval to the bid winner.

Mr Fawcett said Enhance was not paid a ''success fee'' - a payment to lobby firms when companies land a government contract. He said a ''small monthly retainer'' was paid for Enhance's services, which began around October last year.

The State Government failed to answer several questions from The Sunday Age about the train tender, including whether any ministers, their staff or senior bureaucrats received entertainment from the Enhance Group. The Government was also asked if it was appropriate for an adviser to switch from a minister's office to a lobbying firm working on a major tender.

Stephen Moynihan, spokesman for Public Transport Minister Lynne Kosky, said the train tender was extensive and transparent. ''(The) probity auditor has overseen the entire process and has signed off that there were no probity issues,'' Mr Moynihan said. ,

The Queensland arm of Enhance Group has recently become embroiled in a lobbying scandal that led to its chief executive officer, Ross Daley, a former Labor staffer, resigning after accepting a $1 million success fee from property and investment group Trinity. Mr Fawcett has lobbied the Victorian Government on behalf of Trinity's development interests in the contentious rezoning of the San Remo town boundary in South Gippsland.

Enhance Group and Queensland Premier Anna Bligh were criticised recently when it was revealed Ms Bligh's two deputy chiefs of staff had both worked for Enhance.

Opposition Leader Ted Baillieu said that Victoria urgently needed an independent commission against corruption and a lobbyists register to investigate and ''put an end to the culture of Labor mates and their secret access and arrangements with the Brumby Government''.

Premier John Brumby has said he is considering establishing a register of lobbyists.

Yesterday, the Government attacked the Opposition for hypocrisy over a $3500-a-head Liberal Party fund-raiser hosted by Mr Baillieu and others in May.

Labor has been on the defensive since Friday's Progressive Business event, where business leaders paid up to $5000 for private meetings with the Premier and ministers.