Land council executive accused of conflict over millions in loans

FORMER NLC boss Joe Morrison accuses executives of ‘conflict’ in rental dispute over Darwin offices, an audit report reveals

Former NLC chief executive Joe Morrison raised his concerns with Indigenous Affairs Minister Nigel Scullion the day after his sacking in November.

THE Northern Land Council is being dudded out of more than $200,000 a year by its Darwin landlord, an Aboriginal corporation whose directors have an “acute” conflict of interest, according to an internal audit.

The allegation is contained within a draft audit committee report which prompted Indigenous Affairs Minister Nigel Scullion to intervene last week, now obtained by the NT News.

The report outlines concerns raised by former NLC chief executive Joe Morrison in a letter to Senator Scullion the day after his sacking in November.

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In response, the Minister ordered the committee to also investigate millions in unsecured loans made to related entities and their directors.

Mr Morrison’s letter revealed seven of the NLC’s nine member executive council including chairman Samuel Bush-Blanasi and deputy chairman John Christophersen are also directors of the North Australia Aboriginal Corporation which owns the council’s Darwin office.

The audit committee subsequently found the NLC pays $986,853 a year in rent to the NAAC, which the committee alleges is “substantially more” than market valuations obtained by either organisation after the lease expired in March 2017.

The full council voted to renegotiate the lease the following November “at current market rates” but a proposal to that effect put forward by the NLC was rejected as being “unworkable”.

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“The chairman and all of the relevant members of the executive council have been advised, in some cases repeatedly, of the conflict of interest arising from those circumstances,” Mr Morrison alleged.

“This conflict is particularly acute in light of the substantial divergence between the NLC and NAAC over what the fair rent for the NLC Darwin office should be. The directors of NAAC support NAAC’s demand for a rental rate that is beyond the current market rates as independently advised to the NLC.”

There is no allegation by the NT News of any wrongdoing against the members of the executive council.

The auditors also found the NAAC loaned its subsidiary Wirib Tourism more than $2 million via its charitable trust, the recovery of which was “doubtful”.

“The loan amount has been reduced to nil with no explanation on as to how that debt has been discharged,” the report reads.

“It appears that the loan to Wirib Tourism may have been written off and not paid as there has been no corresponding increase in banks or assets.”

The report reveals the full council voted to replace the fund’s trustee in November 2017 but as of January 30 this year that was yet to happen.

NLC chief executive Jak Ah Kit said a “scathing” counter report from Raelene Webb QC which “demonstrates that the (audit) report cannot be given any weight or relied upon” would be made public at next Friday’s full council meeting.

“Eighty per cent of the members have been briefed on the QC’s report without having been given a copy, and the audit report, and have sent resolutions to the minister to say we do not want you to call a meeting and we stand by our executive and there is no conflict of interest,” he said.