State port firm queried
Queensland’s auditor has referred a state-owned business to the corporate watchdog.
The state-owned Gladstone Ports Corporation (GPC) runs the world's fourth-largest coal exporting terminal.
This week, the Queensland Audit Office (QAO) referred GPC to the Australian Securities and Investments Commission (ASIC) over potential non-compliance with legislation, after a QAO report found GPC had spent $1,530,201 on six termination payouts since 2018, and more than $10 million on legal costs in the last financial year.
“Gladstone Ports did not initially provide a report to us, as the external auditor, and [stakeholder] ministers about a payment to a former chief executive officer,” Queensland auditor-general Brendan Worrall said in the report.
“The board delegates approval of termination payments to the chief financial officer and/or chief executive officer… however there is no policy, guidance, or board oversight for the use and approval of settlement and release arrangements.
“Due to concerns over the propriety of decision-making regarding the settlement payments, we reported a significant deficiency to Gladstone Ports.”
Mr Worrall said GPC did not “appropriately approve and sign all board minutes”.
“These compliance matters resulted in us reporting three significant deficiencies to Gladstone Ports,” he said.
“We also reported the matters to the [relevant] ministers and the Australian Securities and Investments Commission.”
The QAO report said the GPC’s legal bills are stacking up in part due to a high turnover of executives.
Seven managers and executives have left GPC since December 2018, and the position of chief executive officer was filled by three executives this year, until one left the company within three months of appointment.
The auditor also made a series of recommendations to address shortcomings in GPC’s governance and oversight.
One of the central suggestions was for policies to be updated to provide guidance of payments through deeds of settlement and release.
GPC chair Anthony Lynham - who was the Palaszczuk government’s mining minister until last year - says the group has made submissions to ASIC over the reported matters.
“In GPC's view (based on external advice), there was no breach of the relevant provisions by GPC of either the Government Owned Corporations Act or the Corporations Act,” he said.
“Appropriate submissions have been provided to ASIC on behalf of GPC in relation to the issues reported by QAO concerning the Corporations Act.”