Allan Fels and NSW Treasury in stoush over toll roads inquiry expenses

Former competition chief Allan Fels has had some of his expenses questioned by NSW Treasury. Picture: NewsWire

During his time as the nation’s competition chief, Professor Allan Fels burnished a solid reputation for crusading on behalf of the little guy. He went to war with price gougers, the cartel bullies, and later emerged as richly regarded for his upright honesty and impeccable moral rectitude.

So why is NSW Treasury painting him out to be some sort of mooch on the taxpayer?

This isn’t Eddie Obeid. This is Allan-bloody-Fels we’re talking about. Mr Probity. A director at the Centre for Public Integrity. There’s an Order of Australia medal pinned to his chest!

Fels was selected by NSW Premier Chris Minns to run a statewide inquiry with Dr David Cousins into toll roads, for which they were paid $1.7m (between them). Their report was deli­vered earlier this year, its recommendations considered by Minns and his cabinet either to be dead on arrival or worth ignoring entirely.

Evidently unhappy, Fels emerged on the ABC last month to dump a bucket on the Treasury NSW and Transport for NSW bureaucrats with whom he liaised, accusing them of suppressing a key part of the report he wrote with Cousins.

“We wanted to publish a lot more information but we were blocked strongly by the three deputy secretaries involved,” said Fels.

Spicy stuff, but there’s more.

Newly released emails obtained by this column suggest this was not the only sparring match between Fels and the departmental boffins throughout his consulting term.

What we didn’t expect to learn was that Treasury executives confronted Fels over expenses he was charging back to the government, and indirectly to the taxpayer.

One note, sent by Treasury analyst John He to Fels’ executive assistant Tania Gropel, asked why Fels invoiced five hours of work to the department for a “speech” delivered to a Fin Review Infrastructure Summit held in November last year.

“We kindly request clarification on whether the AFR Speech portion of the bill was meant to be invoiced to the Toll Review,” wrote He.

Fels replied: “Yes. It’s part of the job. The Minister also spoke. I was not paid, nor received expenses payment.”

This response was forwarded by He – with a frowny face emoji – to Treasury’s Tolling Reform executive director Donna Awad and director Nicholas McCann.

McCann replied “LOL” and Christopher Gavrielatos, another official looped into the email, wrote: “HAHAHAHAHAHAH.”

We’re going to assume none of them found Fels’ explanation satisfactory.

Of course they didn’t; it’s total baloney.

How is electing to speak at a who’s-who event in Sydney, hosted by a newspaper, and done so of one’s own volition, “part of the job” of inquiring into toll roads and their usage? What difference does it make that “the Minister also spoke”? And why would Fels seriously think he’s entitled to bill Treasury for his appearance, just because the masthead wouldn’t pony up for his expenses?

And was it even a speech? A program from the day suggests a panel discussion with three other corporate leaders and an AFR journalist.

The whole thing reeks. If only Minns could ask the old Allan Fels, the 90s Fels, champion of the battler, to run an inquiry into this unusual behaviour.

Months later, on June 21, Treasury was at him again about his spending, this time over $1550 expended on a two-night stay at luxe Capella Sydney. “Can you please provide us with a reason on why you could not find more reasonable accommodation? This was anomalous compared to your usual choice,” said an email draft that officials intended to send to Fels.

A spokesman for the department said Treasury executives did eventually have “a conversation” with Fels regarding his expenses. “A response was received, and the issue was resolved,” they said. “The total expenses incurred by Mr Fels for his engagement were within the expense cap.”

No word from Fels on how he explained the hotel spending. And wouldn’t you know it, he’s on the speaker list for the Fin’s 2024 Infrastructure Summit, starting Monday.

Is another stay at Capella on the cards? We can only wait and see if he lobs an invoice for his services to the state.  YB

Ai Group cuts costs

It’s a crowded market for peak industry lobby groups, and competition and business cost-cutting appears to be biting at the Innes Willox-led Ai Group – which is cutting jobs in the face of a membership drop, and is said to be about to post another big annual loss.

Ai Group split its structure back in 2021, hiving off most of its staff and business operations into ASIC-registered Ai Group Limited. Now what its members see from its annual accounts are those of the lobby group itself – which had revenue of $227,000 last financial year, has no employees and posted a $24,184 profit for the year.

Innes Willox. Picture: Aaron Francis

The only useful bit of information in the document is the news that Ai Group shed 178 members during the year, finishing June with 2909.

But the front end of the membership group did send its affiliate company a $950,000 donation – on top of the $1.3m sent over the previous financial year.

Ai Group Limited hasn’t yet filed its annual accounts with ASIC – it has until the end of November to do it. But word is the company has posted another big loss, potentially in the millions – which would come on the back of $2.1m in losses over the last two years.

Willox wouldn’t confirm the scale of the losses on Friday, but said a “very small number of staff are at the moment either retiring, resigning or going through a redundancy process”.

The group farewelled corporate affairs boss Tony Melville after 21 years with the organisation in July, and Margin Call hears more long-serving staff are also on the way out. On top of that, Willox is said to have told staff about 15 redundancies are in the offing – from a total headcount of about 250 – but refused to rule out more job cuts later in the year.

“We are simply realigning our business to meet the circumstances businesses are generally facing,” Willox told Margin Call. As an aside, Willox and his senior leadership team was paid about $5m in the 2023 financial year – just under a third of the lobby group’s membership revenue, and 6 per cent of its total $79.6m in revenue. Not a bad place to start if you’re looking for easy cost cuts, perhaps? NE