KEY POINTS:
CANBERRA - Senior Australian Government ministers and officials have been cleared of complicity in the oil-for-food scandal that looks certain to put 12 wheat export executives before the court on criminal charges.
The finding was made by the royal commission into the payment of almost A$300 million ($351.57 million) in illegal kickbacks to the regime of former Iraqi dictator Saddam Hussein by monopoly wheat trader AWB in the run-up to the Iraqi war.
It followed claims that senior politicians and bureaucrats had either assisted in the payment of the kickbacks or had turned a blind eye to them.
"I closely examined the role of the commonwealth and particularly that of the Department of Foreign Affairs and Trade in relation to the oil-for-food programme, with particular emphasis on the department's role in the export of wheat to Iraq by the AWB during the programme," Commissioner Terence Cole, QC, said in his five-volume report.
"I found no material that is any way suggestive of illegal activity by the Commonwealth or any of its officers."
Attorney-General Philip Ruddock promised fast action on the report's recommendations, including the formation of a taskforce to investigate possible criminal charges against 11 former AWB officers and another man allegedly involved in an associated scam.
Those to be investigated include former chairman Trevor Flugge, former chief executive Murray Rogers and former chief financial officer Paul Ingleby.
Ruddock said that in the next two weeks the Government would also introduce new legislation to help the taskforce gain access to documents held by the Cole commission.
It would also move quickly to consider further legislative changes recommended by Cole to strengthen Australian domestic laws to enforce United Nations sanctions.
But while the report is being claimed as a vindication by Prime Minister John Howard, a furious political battle is under way over the Government's failure to identify and stop the AWB kickbacks.
Labor is claiming incompetence and negligence that allowed Australian money to be used by Saddam to fund weapons - turned against Australian troops during the invasion of Iraq.
Opposition Leader Kim Beazley described the Government as shameless.
"They are saying with pride here, they are boasting of it, that 'we are not criminally culpable, we are merely incompetent' - incompetent and negligent in the face of the worst federal scandal in living memory.
"Three hundred million dollars went to Saddam Hussein on their watch, subsequently turned by Saddam Hussein to war-making capacity, then subsequently used on Australian soldiers and others immediately after it.
"They scuttle away from the accountability they should have allowed themselves to be subject to. That they should look at this finding with pride shows us how low public standards have sunk in this country, how low public accountability has come in this country, under this appalling Government."
In an indication of the fury of the looming debate - now tied also to mounting opposition to Australia's presence in Iraq - Parliament erupted in insults and catcalls.
Beazley attacked the Government for "rorting" the inquiry's terms of references to protect Foreign Minister Alexander Downer and Deputy Prime Minister and former Trade Minister Mark Vaile.
He quoted a statement by Cole last March in which the commissioner said it was not his function to set his terms of reference, and that it was not appropriate for him to seek amended terms to inquire into significantly different matters.
This included allegations that Government ministers had breached their legal obligations to uphold UN sanctions.
Howard rejected the accusation, condemning Beazley's claims as a "farrago of falsehoods" and describing Cole as a fearlessly independent lawyer of great integrity and great forensic skills.
He said that with the release of the report the Australian public would be able to judge "the veracity of [Beazley's] outrageous allegations".
Howard told reporters the Government had hidden nothing. "The commissioner has found in the most emphatic terms imaginable that there is no evidence of wrongdoing."
Ruddock told Parliament that no other country among the 66 identified in the UN report on the oil-for-food scandal had set up such an independent, open and far-reaching inquiry.
He quoted the Cole report's conclusion, which said: "AWB has cast a shadow over Australia's reputation in international trade.
"That shadow has been removed by Australia's intolerance of inappropriate conduct in trade, demonstrated by shining the bright light of this independent public inquiry on AWB's conduct."
Ruddock said that, like Cole, the Government was disappointed that a major Australian company could be involved in such inappropriate conduct.
Cole had held 76 days of hearings, dealt with hundreds of witness statements and hundreds of thousands of documents. The Government had provided extra resources when requested and amended the terms of reference five times. "I reject any claim that Commissioner Cole has been hampered in his important task."
COLE INQUIRY INTO KICKBACKS
Key findings
* Terence Cole, QC, recommended 12 people be investigated for possible criminal or corporate offences.
* AWB knew transportation fees it paid to a Jordanian trucking company, Alia, were a means of funnelling money to Saddam Hussein's regime during the UN oil-for-food programme.
* The Government was cleared, including Prime Minister John Howard, Foreign Minister Alexander Downer and Deputy Prime Minister Mark Vaile, of any knowledge of payment of kickbacks.
* The Department of Foreign Affairs and Trade was cleared of turning a blind eye to the A$290 million paid.
To be investigated
* Former AWB staffMark Emons, marketing manager
* Trevor Flugge, chairman
* Peter Geary, trade general manager
* Dominic Hogan, marketing manager
* Paul Ingleby, chief financial officer
* Michael Long, head of international sales and marketing
* Nigel Officer, global marketing chief
* Murray Rogers, chief executive
* Charles Stott, head of marketing, rural services chief
* Michael Watson, chartering manager
* Jim Cooper, company secretaryTigris Petroleum:
* Norman Davidson Kelly, founder of Tigris Petroleum.
- AAP
