‘Drain the swamp’: Labor calls for Australia Post reform after Christine Holgate saga

Australia Post needs to go further than settling its dispute with former CEO Christine Holgate, according to federal Labor.

Shadow Communications Minister Michelle Rowland has called for ‘political hacks’ to be dumped from Australia Post’s board. Picture: NCA NewsWire/Jeremy Piper

Post offices, the union and employees would have a greater say on who sits on the Australia Post board under a plan by federal Labor to replace political appointments with “public interest directors”.

Opposition communications spokeswoman Michelle Rowland has called for the draining of the “dysfunctional swamp” of Liberal Party appointments from Australia Post’s board following the dramatic, and expensive, leadership saga that has engulfed the postal service.

Her comments put a spotlight on how directors are appointed to the boards of government-owned businesses, with many, including Australia Post, the ABC and NBN Co facing fierce competition from commercial operators.

Ms Rowland’s call follows former chief executive officer, Christine Holgate, receiving a $1.1m payout from Australia Post last week, lifting the cost to taxpayers of her departure to an estimated $2m.

Ms Holgate left the organisation last October after Prime Minister Scott Morrison demanded she stand aside “or go” after she rewarded four senior executives Cartier watches worth almost $20,000 – on top of their cash bonuses – for brokering a banking deal worth $66m a year.

Ms Rowland called for a reformation of Australia Post’s board, which includes former Liberal federal and state director, Tony Nutt; former Queensland LNP president Bruce McIver; former Liberal Senator Michael Ronaldson; former Woolworths director Diedre Willmott; Jan West; Andrea Staines and Mario D’Orazio.

“Australia Post does not belong to Scott Morrison and his cronies. It belongs to the Australian people,” Ms Rowland said.

Instead, Ms Rowland is advocating the creation of “public interest directors”, which would be nominees for the employees and their unions, and post office licensees.

“From the moment the watch purchases became public, Scott Morrison was driven by panic and politics,” Ms Rowland said.

“It was the job of the board to withstand his pressure, and to act diligently to uphold due process and natural justice. The settlement with Ms Holgate is an admission that did not occur because the board lacked independence and the chairman didn’t understand his role.”

The idea of public interest directors surfaced during a Senate committee report following an inquiry into Ms Holgate’s departure.

The committee recommended that the Australia Post Board be restructured to ensure that its makeup is “consistent with the original intent of the Australian Postal Corporation Act 1989, and so that it functions properly as a public enterprise”.

The Senate committee stated that a restructured board should include nominees of: the House of Representatives; the Senate; the employees and unions; and the licensees.

“Including these nominees as board members cements the responsibility that Australia Post has to the parliament and provides employees, unions and licensees with a voice in the decision-making process,” the report stated.

“Nominees from the House of Representatives and Senate would not receive additional remuneration for their position on the board, as this work would be considered as a part of their parliamentary duties.

“Restructuring the Board would also create an opportunity to bring the work of Australia Post closer to the parliament, improving transparency and oversight.”

But in the government’s dissenting report it rejected the proposal.

“The recommended approach would also be inconsistent with the arrangements that exist for other Government Business Enterprises (GBE),” the dissenting report stated.

“GBE boards require members selected on skill in corporate governance, public administration and/or the relevant commercial industry fields in which each GBE operates. It would be contrary to that requirement if members were appointed solely on representative grounds”.

In a joint statement issued with Ms Holgate last week, Australia Post said it “acknowledges that it has lost an effective CEO following the events on the morning of October 22 2020” and “regrets the difficult circumstances surrounding Ms Holgate‘s departure”.

Meanwhile, Communications Minister Paul Fletcher said the postal service could now move forward and prepare for Ms Holgate’s replacement, former Woolworths executive Paul Graham, who starts his role in September.

“This will be an important milestone as Australia Post positions itself to respond to continuing changes in its operating environment,” Mr Fletcher said.