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A star rating system designed to help obese Australians lose weight appears an unhealthy distraction for the Coalition.

By Debra Jopson.

Fiona Nash denies conflict of interest for chief of staff

Embattled Fiona Nash makes a point at Senate estimates this week.
Credit: AAP Image/Daniel Munoz

They both wore teal ribbons in support of ovarian cancer awareness, but that was as far as any solidarity went for senators Penny Wong and Fiona Nash. Wong worked a forensic inquisition in parliamentary estimates this week, demanding to know what Nash knew. And Nash hedged and fended and gave the rehearsed quote again.

“What would be better,” Nash complained, teeth gritting above pearls, “would be if you were not asking the same questions 10 times trying to get different answers.”

With fellow Labor senators, including the large terrier John Faulkner, Wong was trying to establish how the Assistant Minister for Health had joined her former chief of staff, Alastair Furnival, in ordering the taking down of a website that gave health star ratings to packaged food. She wanted to know how Furnival had been able to continue as a director and shareholder of a lobbying company he owned with his wife.

Nash insisted there was no conflict of interest, because the company lobbied neither herself, nor Health Minister Peter Dutton, nor their department. And besides, Furnival had told her his accountant was divesting him of his shareholding.

“My understanding was it was a complex and lengthy process,” Nash said.

“He’s got to transfer one share to his own partner,” snapped Wong. “Why is that so hard?”

It has been said that once Nash and her chief of staff intervened, the Health Star Rating website – mark of a nation’s fight against obesity – vanished into cyberspace. And yet, here it was on the third day in Senate estimates continuing to haunt the Parliament.

More than two years in the making and meant to help consumers “reach for the stars” on packaged food, rated on salt, saturated fat and sugar content, the website’s disappearance has led to a key adviser, Furnival, losing his job and the career of a new minister from country NSW being brought to the brink.

Nash and her prime minister are resisting deep questioning over its demise, and the conflict of interest and ministerial obligation issues that it has raised. But it is proving hard to get away from the website, which has taken on a life beyond its pixels.

In another part of cyberspace, there is a stark pointer to how this happened. Furnival’s two brief LinkedIn pages show the dual nature of his career. According to one, he has been an adviser to the Howard and Greiner governments and the NSW National party. The second lists him simply as “owner” of Australian Public Affairs (APA), the company now run by his wife.

In his life before the appointment to Nash’s office, Furnival promoted junk food as a lobbyist. He was formerly chief economist for chocolate maker Cadbury, whose parent, the snack food goliath Mondelēz (formerly Kraft), was an APA client.

Since his part in taking down the website has become public, it has been revealed that in 2012 he met Tasmanian government representatives lobbying for Cadbury in its quest for taxpayer dollars to fund a Hobart waterfront visitors’ centre.

Early last year, he also participated with Tony Abbott in the Pollie Pedal, a charity event whose sponsors included Cadbury. The wheeling may have had nothing to do with the dealing, but some have found the Abbott-Furnival-Cadbury link too sweet. Last month, the federal government allocated $16 million to the chocolate maker, in keeping with the prime minister’s pre-election promise.

Under parliamentary rules meant to thwart conflicts of interest, Furnival was supposed to ditch his direct links to his lobbying company when he became Nash’s chief of staff in September 2013. Yet by December 13, when he attended a national-state forum on food regulation which Nash chaired, he had not completely done so.

Neither he nor Nash declared that he had any conflicts of interest under the forum rules requiring disclosure.

When Labor senator Jan McLucas asked if the minister had not “twigged” that the meeting would discuss significant food issues and that Furnival may not yet have divested himself of his lobbying company interests, Nash bridled.

“You are somehow insinuating there’s been some improper behaviour … that was afoot because it wasn’t declared. There was no need for a declaration of a conflict of interest, because there wasn’t one,” she said.

At that meeting, Nash pressed hard for the star rating system to be delayed. Her argument was that it was premature to introduce the website without a cost-benefit analysis. But health ministers voted for it to go ahead.

The Health Department complied on February 5. But less than 24 hours after it had gone live, the website was taken down, following four calls from the minister’s office to the department. Close questioning by Labor senators established the chain of events.

Nash told estimates she was sitting next to Furnival when he made the first call, to an officer at the Health Department. We know the officer was Kathy Dennis, because Nash let her name slip in the Senate. The Sydney Morning Herald has reported that Dennis, who had charge of the site, refused to jettison it because it emanated from the Council of Australian Governments’ food ministers’ forum.

She reported the call to a more senior officer, department head Jane Halton told estimates, giving the explanation that the request was “above my pay grade”.

Her senior, Mark Booth, took the next two calls from an assistant adviser in Nash’s office, but was planning to ask his own superior when the minister herself called.

Asked how he responded, he said: “I thanked her for her phone call and said: ‘Yes, Senator.’”

Wong’s quizzing in estimates prompted this statement from Nash: “When my former chief of staff called the officer to take down the website you’re referring to, at my direction, I was clearly aware that he was still a shareholder.”

The process of quitting his shareholding was under way but incomplete, she said.

Wong: “You clearly remembered that at the time but you happened to forget that on Tuesday, the 11th of February, when you were asked the question in the Senate.”

That was the hellish day that Nash told the chamber: “There is no connection whatsoever between my chief of staff and the company Australian Public Affairs. My chief of staff has no connection with the food industry and is simply doing his job as my chief of staff.”

That night, Nash was forced to confirm that Furnival still had a direct interest in APA.  She spoke of unspecified “arrangements” made to comply with her ministerial obligations. Labor has since accused Nash of misleading Parliament and of breaching her ministerial obligations. The calls for her to resign, or be sacked, began.

Fairfax Media and The Guardian were reporting the awkward fact that APA was a partnership registered with NSW Fair Trading. The partners were APA Pty Ltd, Strategic Issues Management and Centre for Litigation Communications Pty Ltd. There were two shares and two directors of Strategic Issues Management, according to Australian Securities and Investments Commission documents. The documents carried just two names – Alastair Furnival and his wife, Tracey Cain.

On February 12, Furnival’s wife, managing director of Australian Public Affairs, released a statement saying her husband had resigned and left his role as company chairman last September.

“Obviously, since his resignation and appointment, the process began to transfer Alastair’s shareholding to me as his former co-director,” she said.

On the same day, South Australian Health Minister Jack Snelling wrote a letter to Nash and Dutton, pointing out that ministers had voted for the health star rating website at their December 13 meeting. He demanded it be reinstated.

The following day, the opposition began to turn its attentions to Abbott’s role. In question time, Nash said she had given the Prime Minister’s Department “all information” about her chief of staff with “appropriate timing”.

She kept it hazy and Abbott delayed any answers. Furnival hung on for one more day, until Nash announced in a curt statement that he had resigned as chief of staff. Furnival put out his own statement, saying that neither he nor his wife had acted improperly. This, he said, was “a political smear campaign”.

But this week in estimates it was established Nash had not ensured he had divested himself of his directorship and shareholding, which had led to a possible conflict of interest. She had given him no written agreement that as staff he could continue this holding, and nor does it appear that she asked, as required of her as a minister.

Still Abbott has resisted being drawn, other than to stand by his minister, to invoke the Craig Thomson name and describe this as not even “a zephyr in a thimble”.

Last weekend, the Public Health Association sent out an email and by Monday 66 professors of health had signed a letter to all ministers and governments asking for the star rating system to be implemented as soon as possible.

As our outdoors-loving prime minister would know, zephyrs are often precursors to storms.

This article was first published in the print edition of The Saturday Paper on Feb 28, 2014 as "Yes, Senator". Subscribe here.

Debra Jopson
is a Sydney-based investigative reporter.