It is a story 40 years in the making: How a state government was brought to its knees

Simon Bevilacqua speaks to key players in a scandal that rocked the state in the 1970s and that continues to raise questions about the integrity of Tasmanian politics,

Hugh Dell. Picture: Simon Bevilacqua

“I’VE been waiting for over 40 years to tell my story” — that was former senior political adviser Hugh Dell’s forthright response when asked to speak on record about one of the most explosive political scandals in Tasmanian history.

Dell created a storm in 1973 when he handed Tasmanian premier Eric Reece a sworn statement that alleged Reece’s deputy, a Queen’s Counsel who went on to become a Supreme Court judge, had engineered a bribery plot to bring down the previous state government. It threw parliament into a spin and prompted a police investigation.

More than 40 years on, Tasmania Police is reviewing the files of the 1973 police probe because of fresh claims by Tasmanian author James Boyce in his book Losing Streak: How Tasmania was Gamed by the Gambling Industry.

The return of the issue to the public eye has torn the scab off a wound that had not properly healed for Dell.

“I just paid the price,” Dell, a former Mercury journalist, explains. “Absolutely no peace and quiet, anxiety, and the whole thing running over and over in my mind.

“I was a bloody good journalist and I wasn’t going to be happy until I got the whole thing sorted out in my mind. It took me years to get possession of all the necessary facts to make a tapestry of it.”

Dell is an imposing man, not so much physically at 81, but mentally. He is intelligent and combative. Government roundsman and columnist for the Mercury, he left the paper in 1966 to be press secretary for attorney-general and deputy premier Mervyn Everett, later working as senior adviser to premier Eric Reece.

Everett, whose sharp mind was honed working as a divorce lawyer in the rugged days before no-fault divorce laws, was said by the Mercury of the day to have “dominated state politics for a decade”.

Reece was a Labor hard man loyal to the Australian Workers’ Union and one-time federal ALP president. As Tasmanian premier from 1958 to 1969 and 1972 to 1975, he was known as Electric Eric for his dogged support for hydro-industrialisation, and approved Lake Pedder’s flooding.

When Dell went public with allegations Everett engineered a bribe that Reece knew about, he was taking on political standard-bearers of their time.

He also pointed the finger at the previous deputy premier, Kevin Lyons, son of an Australian prime minister; the Tasmanian gambling industry, including offcourse bookies; one of Australia’s most well-connected companies, in Federal Pacific Hotels; and one of the world’s most bullish firms at a time it was at the peak of its expansive global influence, in British Tobacco-Amatil.

It is hard to imagine a more powerful cohort of adversaries.

When Dell talks of those turbulent days, he is tense. He thumps the table with his fist in the kitchen of his working-class home 30 minutes’ drive from Hobart. His brow furrows. Losing train of thought, he composes himself by taking a breath and closing his eyes.

Such signs of stress are common to whistleblowers. It is difficult to know whether they are traits of a personality type with the necessary chutzpah to defy authority or the result of psychological wounds from raising the head above the trenches. Perhaps both.

Current federal Denison MP Andrew Wilkie knows a whistleblower’s plight.

In 2003, he resigned as an Australian intelligence officer because of fears the invasion of Iraq was being based on falsehoods and distortions. His life derailed, his career cut short.

“Dell, like many whistleblowers, unfortunately paid a heavy price for what he did,” explains Wilkie. “Sadly, this is all too often the case where whistleblowers are ostracised and even punished.

“Blowing the whistle can take a toll on people’s lives, especially in Australia and in small places like Tasmania, where whistleblowers will routinely lose their jobs, their health and even their family and friends. Indeed, some even take their own lives, so difficult is the path they’ve chosen.”

Dell was alienated. His political career nosedived. He was booted from the ALP. “It was hell. It was what finished my [first] marriage,” he said.

Dell’s allegations, however, did not come out of the blue.

Former deputy premier Mervyn Everett

Tasmania was rife with rumours that Kevin Lyons — deputy premier and leader of the Centre Party, which held the balance of power from 1969 to 1972 — had been bribed to resign and bring down the Bethune Liberal state government.

Dell had long held suspicions something was awry, having worked with Everett for years, but he says his fears were compounded after talking with Labor MP Ken Austin at the 1973 state ALP conference in Devonport.

At a hotel breakfast on March 3, 1973, Dell says Austin claimed Everett had held a strategy meeting at his Hobart legal office, attended by British Tobacco, Federal Hotels and a local bookie.

Austin, he says, told of Everett’s plan for the bookie to forgive Bill Neilson, the premier after Reece, about $35,000 of gambling debts.

In exchange, Everett would ensure a totaliser monopoly, or TAB, would not be established in Tasmania, clearing the way for a new offcourse betting premises in Hobart.

Dell says he was stunned: “I took out my notebook and wrote it all down in front of him and he never said you can’t report this. He wanted to do damage.”

Dell says Everett’s scheme also involved putting the brakes on the government’s prosecution of British Tobacco for alleged fraudulent acquisition of a large parcel of grazing land in Tasmania’s North-East, much of which is now Mt William National Park.

THE government was at loggerheads with the global tobacco giant over allegations it had used local front men to pose as small operators to stake claims in a soldier-settlement-like scheme designed to assist Tasmanians. It was not meant to be a land grant to multinationals.

Dell says Lyons, when deputy premier, stymied the court action.

Everett’s scheme, Dell says, also paved the way for Wrest Point casino, which opened in 1973. Debate about the licensing of Australia’s first legal casino had raged in state parliament for years.

Police investigating the allegations said they spoke to a conga line of witnesses who had stated that they had heard Austin make similar claims and that the Labor MP implicated himself in the bribery and claimed to have documentary proof he was telling the truth.

“Mr Austin was not only naming Mr Everett and Mr Lyons as the conspirators, but was identifying himself as having been a party to the conspiracy,” the police report states.

Dell says Austin’s claims fit his own experiences and that Everett once boasted to him that he had found the solution to the financial difficulties of Labor and Tasmania, and would often return from Melbourne meetings armed with wads of cash.

He says the police minister of the day, the late Henry McLoughlin, told him in about 1975 that he had seen Everett arrive in the parliamentary dining room, direct from the airport, and flash around cash in a briefcase.

“He told me this happened more than once,” Dell says. “What was he doing with suitcases stuffed full of notes and bragging about it?”

Dell voiced some of his concerns from the floor of the 1973 state conference.

Tasmanian Labor stalwart Terry Aulich was there: “Hugh got up and tipped the bucket and it was shock, horror. He dumped on his party in a big way at that conference and was persona non grata from that moment.”

AULICH, an MHA from 1976 to 1982 and senator from 1984 to 1993, says state conferences were “very much open to the media” in those days and there were often heated exchanges from the floor. Dell’s foray was no exception.

Dell says Reece’s response was to yell: “If someone did the right thing by you, they would break your neck.”

Dell also took his concerns directly to Liberal and Labor MPs.

“The next thing you know, I’ve gone public,” Dell says.

He wrote a story in the University of Tasmania newspaper Togatus.

Then, on July 2, 1973, he presented premier Reece a nine-page, sworn statement, witnessed by a Justice of the Peace, with a letter requesting a royal commission.

State parliament erupted.

Former premier Eric Reece

HATCHING THE PLOT

DELL says Everett’s masterplan to enlist the quid pro quo support of bookies, Federal Hotels and British Tobacco was conceived before the 1969 state election, but was derailed by Labor’s failure at the polls.

The election produced a hung parliament and Lyons, son of former PM Joseph Lyons and Dame Enid Lyons, was cast as kingmaker.

As leader of the Centre Party, Lyons had to decide whether to back Labor or the Liberals to form government. Both sides of politics courted his support.

Police were told that during this time, Austin had claimed to have met Lyons with Dame Enid at her Devonport home and had offered him the position of premier in a Labor-Centre coalition.

The police report, however, doubts Austin had his party’s imprimatur to make any such offer and says Reece and Lyons “emphatically” denied it.

Lyons eventually delivered power to the Bethune Liberal government, and was made deputy premier.

Dell reckons Lyons and Everett became “thick as thieves”, with the new deputy often dining at the opposition Labor MP’s West Hobart home and regularly talking on the phone.

The police report reveals Lyons went to Everett for legal advice just days before he resigned and brought down the government.

“The question may arise as to whether, in view of his political affiliation, it was professionally ethical for Mr Everett to have undertaken to give legal advice in a situation which was likely to be, and ultimately was, politically advantageous to his party,” the report states, but dismisses any concern as “outside the ambit of this investigation”.

“There is not the slightest indication that this advice was received on anything other than a friendly basis between two members of the House of Assembly who had been parliamentary colleagues, although in opposition, over a long period of time.”

THE HORSE’S MOUTH

DELL’S sworn statement ignited furore because it forced Reece to publicly face rumours that were rife in Tasmanian society.

“[Dell] was the one who broke the rules and made the space for all this to come out,” explains author James Boyce.

The police report makes “no suggestion of malice or other ulterior motive” on Dell’s part, describing him as honest and conscientious.

His evidence, however, is hearsay and circumstantial. Dell was the messenger.

The linchpin in this tale of political intrigue was the person police were told had admitted playing a role in the bribery — Labor member for Denison from 1964 to 1976, Ken Austin, who died in 1986.

What did he say to police in 1973? Nothing.

Police spent months travelling the state interviewing people, from MPs to party hacks and members of the media.

They left Austin until the final throes of the investigation. On October 11, 1973, Austin and his solicitor were called to Hobart police HQ to be told that police planned to recommend legal action against him for making false statements.

“Mr Austin elected to exercise that which was his right and remained silent,” the report says.

No questions. No statement. No attempt to dig beyond hearsay. No request to see the evidence others said Austin had in his possession. Nothing.

The horse’s mouth, a logical starting point for any such inquiry, had been gagged by a legal threat in the closing chapter of the investigation.

Former deputy premier Kevin Lyons

SHAMEFACED

SIR Max Bingham, attorney-general in the Bethune government, recalls when, as opposition leader in 1973, “shamefaced” police investigators told him they had found nothing.

It was odd police did not grill Austin, he said, but “even odder that they didn’t interview any of us”.

After politics, Sir Max made a career of fighting corruption, joining the National Crime Authority and founding the Criminal Justice Commission in Queensland in 1989.

Now retired in Hobart, he had not read the police report until a few months ago when he saw parts reproduced in James Boyce’s book.

He says he can hear Everett’s voice in the report’s wording and suspects he wrote “relevant sections”.

Given 40 years to reflect, Sir Max remains in no doubt: “Lyons was bought.”

According to Wayne Crawford, the Mercury’s political reporter in 1973, Lyons came across as a “good bloke”.

But the Walkley Award-winning journalist says there is now little doubt Lyons was “crooked as a dog’s hind leg”.

“The evidence is certainly stacked against him,” Crawford says.

The senior minister Reece appointed to oversee the police probe was none other than Everett, who released only selective details of the report.

The report was then secreted away from the public for the next 25 years as a cabinet document.

The public at the time was largely kept in the dark about the probe into claims about Lyons’s two new Melbourne homes, bought after his resignation; his loan from Federal; his sale of land to bookies; the job that landed him a PR firm; and his $25,000 advance from British Tobacco to write memoirs still yet to be published.

Austin was neither charged nor sued, despite the admonitions of police, and continued as an MP until 1976, being chairman of committees in his final years.

Austin’s family to this day denies he did anything other than repeat a rumour.

A family spokesman said the scandal “effectively destroyed” his political career: “He was made the scapegoat in the whole matter and until his passing he strongly maintained that he, like many of his parliamentary colleagues, were constantly discussing the myriad of rumours circulating in the community about the issue and at no point had he stated the rumours were fact.”

Days after the release of the report’s conclusion, Dell publicly apologised and withdrew his allegations.

Austin’s family took that as vindication.

Dell, however, says he threw in the towel because he was “fed up and angry” and police had told him there was “no chance of the truth coming out because Everett was attorney-general”.

“My attempt to get the truth told was over, all I wanted was my quiet life back,” he said.

THE DIE WAS CAST

DELL’S sworn statement to Reece in 1973 drew the battlelines for police investigators with judicious precision.

His historic missive declared: “These allegations, if true, reveal a criminal conspiracy to pay a member of parliament a large sum of money to gain for him other advantages on the condition that he bring down a legitimately elected government. If they are not true, they reveal that a member of the Parliamentary Labor Party is perhaps criminally libelling a fellow member of parliament and others.”

Thus, the die was cast.

The police probe concludes: “Not one single aspect of the allegations concerning conspiracy, bribery and corruption has been substantiated” and they “appear nothing more than a farrago of false and fatuous statements”.

Dell remains defiant: “At 81 years of age ... I am as strongly committed to the truth being known as I ever was.”