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The real story this week is not Gladys Berejiklian’s relationship with Daryl Maguire but whether she knew the details of his deal-making – although her supporters would rather you focus on the former. By Mike Seccombe.

‘Poor Gladys’ rings hollow after premier’s ICAC grilling

NSW Premier Gladys Berejiklian speaks to the media on Monday.
Credit: AAP Image / Dean Lewins

In its unique way, the defence of Gladys Berejiklian, following her appearance before the New South Wales Independent Commission Against Corruption (ICAC) this week, was as sexist as any of the attacks we have seen on female politicians.

Call it the “poor Gladys” defence. It encouraged the public to focus not on the actions of a powerful politician but on her vulnerability.

The premier herself used this as cover, repeating over and over, “I stuffed up in my personal life”, as if the issue were not what she might have done wrong in the public domain, but what had gone wrong in private. Her supporters, mostly from the moderate wing of the Liberal Party, ran the same line. And none put it in more blatantly gendered terms than former prime minister Malcolm Turnbull.

On Tuesday, the morning after Berejiklian revealed to ICAC that she had been in a secret relationship with former Liberal MP Daryl Maguire for more than five years, Turnbull went on ABC’s RN Breakfast to plead that the premier simply “fell in love with the wrong guy”.

Turnbull laid on the emotion with a trowel.

“Is she the first woman to fall in love with the wrong guy? To be let down by someone she was in a relationship with? I don’t think so. Perhaps the upshot of this will be that people will realise that Gladys Berejiklian is of flesh and blood, that she’s human … She’s craved love and affection. She’s placed her trust with the wrong person,” he said.

But this is not the issue before ICAC.

The business at hand – to quote the commission itself – is “investigating allegations that, from 2012 to August 2018 … Maguire engaged in conduct that involved a breach of public trust by using his public office, involving his duties as a member of the NSW Parliament, and the use of parliamentary resources, to improperly gain a benefit for himself and/or entities close to him.”

These entities include a company, G8way International, which ICAC says Maguire “effectively controlled”.

Under questioning on Wednesday, Maguire admitted he had indeed used parliamentary staff and resources to pursue his private business interests, effectively turning his Parliament House office into an office for G8way International.

He has now confessed to all manner of perfidious activity. There was detailed discussion of schemes being plotted and bags containing thousands of dollars being dropped to his office.

There is no suggestion, thus far, that Premier Berejiklian acted corruptly.

Nonetheless, a trove of communications has been unearthed by ICAC in the course of Operation Keppel – as the investigation is codenamed – through intercepted phone calls and text messages between Berejiklian and Maguire, in which the two discuss his finances and business. They have raised questions that essentially boil down to “what did she know and when did she know it”.

And this evidence, says Geoffrey Watson, SC, a former counsel assisting ICAC, raises the prospect “that the person at the top, who was not corrupt herself, was willing to turn away upon finding that another powerful politician in her group, who held the position of parliamentary secretary and was a long-time member of parliament, was doing the wrong thing”.

This, in turn, goes to what he calls the “culture of corruption” in NSW.

“Gladys Berejiklian and the whole of the Coalition have argued for 10 years that there is a culture of corruption in the ALP. And they were right to do that. There was,” says Watson.

Such a culture, he says, extends beyond the corrupt acts of certain individuals.

“When you talk about a culture of corruption, what you are talking about also is a tolerance, a willingness to look away. And that comes down from the top,” he says.

“You just can’t turn away. Is there some sort of relationship exception? I don’t think there is. I don’t think there are any grey areas.

“Whether it’s a romantic interest or a long-term friend or even a member of the family, if you’re willing to turn away from evidence of corruption, then you’re not fit to hold your position,” says Watson.

Berejiklian, of course, maintains she would have taken action had she known of any wrongdoing, but says she had no reason to suspect Maguire was up to no good.

However, this is not the first time the former Wagga Wagga member has been caught up in an ICAC inquiry. There was also Operation Dasha, relating to allegations of impropriety in relation to development approvals involving Canterbury council in Sydney, and “former councillors and other public officials”.

Secretly recorded phone calls between Maguire and then Canterbury councillor Michael Hawatt in 2016 showed him trying to strike a lucrative deal for the multimillion-dollar sale of a Sydney property to a Chinese developer.

The revelation resulted in Maguire’s resignation, on July 13, 2018, from the Liberal Party and, the following month, from the parliament.

On Monday, Berejiklian told the inquiry she was “very forceful” in calling for him to go. Yet their secret “close personal relationship” – as she called it – continued.

In fact, it continued until after she was first required to give evidence to this inquiry on August 16.

“The last conversation I had with him was on 13 September,” Berejiklian told the inquiry.

According to her evidence, the relationship began shortly after the 2015 election, “to the best of my recollection”.

She said she had kept it secret for a number of reasons: partly because things might be awkward if it became known that the premier was engaged in a personal relationship with another member of parliament, and partly, she told ICAC, because “I didn’t feel the relationship had sufficient substance for it to be made public”.

Some evidence before the commission suggests that Berejiklian and Maguire were unusually close, even earlier than she acknowledges.

In a text message exchange on February 11, 2014, Maguire wrote: “Hawkrss good news One of my contacts sold a hotel for 5.8 million I had put her in contact so I should make 5K.”

“Hawkrss” was clearly a typo. As Berejiklian explained to ICAC, it is more usually spelled “hokis”. It is an Armenian term of endearment, translating roughly to “my soul” or “my beloved”.

In reply she wrote: “Congrats!!! Great News!!! Woo hoo”. Subsequent messages in the exchange discussed Maguire’s percentage commission from the deal.

When asked about this, Berejiklian had “no recollection” – which is possible, given it happened almost seven years ago. And also because Maguire so frequently spoke with Berejiklian about his many and varied money-making schemes, which she derisively, repeatedly dismissed during her testimony as “pie in the sky”.

“Ask my colleagues,” she invited the commission. “He was always big-talking about deals [and] they always seemed to fall through.”

Berejiklian has consistently claimed she knew no specific details of Maguire’s schemes, and certainly nothing that would raise concern about their propriety.

“They always seemed quite fanciful to me, and I always assumed that if any of them did happen to materialise that he would have disclosed them at the appropriate time.”

But, she conceded, she never checked that he had.

Worthy of note is a loophole in the relevant code of conduct, which states that although ministers are prohibited from having “secondary” jobs, this does not apply to parliamentary secretaries.

Thus Maguire, who never rose above the rank of parliamentary secretary during his 19 years as the member for Wagga Wagga, was free to pursue business opportunities. But he was supposed to observe a general prohibition against the misuse of office and conflicts of interest.

Maguire pursued these business opportunities with great vigour. As counsel assisting Scott Robertson put it during this week’s ICAC hearings, the former MP sought to “monetise” his modestly high office with little apparent concern about conflicts of interest.

“What I’m suggesting is you sought to use your status … with a view to making money for yourself and making money for your associates,” Robertson said.

“Yes,” Maguire responded.

The inquiry has heard numerous allegations of efforts – sometimes successful, often not – by Maguire to exert political influence on behalf of clients, either by lobbying ministers and senior staffers, or by arranging meetings.

His get-rich schemes, mostly unsuccessful, were many and varied, involving powdered milk, wine, coal-, gold- and tin-mining ventures, a Chinese proposal for a casino in Samoa, steel manufacturing, an automatic car wash and, particularly, various property development proposals.

Many of these were pursued through G8way International, a company in which it is alleged Maguire acted as a shadow director, and from which he declared no income. The company offered clients access “to the highest levels of government”.

One scheme of particular interest was an alleged visa scam, established through G8way by Maguire and an associate, Maggie Wang.

The pair arranged for Chinese nationals to get visas on the basis that they would work for Australian employers. Those employers were paid to support the visas, but the “employees” never actually turned up for work.

The visa applicants paid, and Maguire and Wang took a cut.

Maguire initially told ICAC he thought the scheme was legitimate and claimed he had a “heated discussion” with Wang when he realised it was not.

Robertson put it to him that “you decided to proceed anyway because there was potential money for you in the event that you continued to refer businesses into this immigration scheme. Do you agree?”

“Yes,” Maguire replied.

He admitted to receiving thousands of dollars in proceeds from the scheme, delivered in cash by Wang to his parliamentary office.

Perhaps the most significant matter before the commission, though, relates to Maguire’s efforts in 2017 to broker a deal involving Chinese property developers and a 230-hectare parcel of land at Badgerys Creek, adjacent to the new Western Sydney airport site. The land was owned by Louise Raedler Waterhouse, of the noted racing family.

Had the $330 million deal proceeded, Maguire and his associate William Luong would have received a large commission. Under questioning, Maguire reluctantly conceded they might have been in line for up to $1.5 million.

This deal is of particular interest not only for its size, but also its timing.

By 2017, Maguire was considering resigning from parliament after a long career, and in a series of phone calls he and Berejiklian discussed their future together.

The full detail of what was discussed is not known. Portions of one call were played back to Berejiklian in a private session on Monday, and to Maguire in private on Thursday. But both parties were questioned about the conversation in open sessions of proceedings.

Berejiklian told the inquiry of her desire that Maguire quit politics before the 2019 election, after which they would no longer have to keep their relationship secret. She said she thought Maguire shared that desire.

“That’s what I understood but I don’t know, I don’t know given now what’s occurred, if that was truthful. I’m sorry,” she said.

Financial considerations were not an issue, at least on her part, she said. She just wanted to normalise the status of their relationship.

But finances were an issue for Maguire. He had debts of some $1.5 million, and only a tax-free parliamentary pension of about $80,000 a year to look forward to after he quit. He was in need of other sources of income to secure his post-politics future. He told ICAC he had sought guidance from the premier on the matter.

In one phone intercept, Maguire told Berejiklian: “Looks like we finally got the Badgerys Creek stuff done [and] I’ll have enough money to pay off my debts.”

Questions from assistant commissioner Ruth McColl provided an insight into ICAC’s concerns.

“You knew his financial position was that he was in debt to the tune of about $1.5 million, and on 7 September he tells you that William tells him the deal is done and so hopefully that’s about half of it gone,” the commissioner told the premier.

“… You said, ‘I don’t need to know about that bit.’ My question to you is, were you, by this stage, starting to be concerned that Mr Maguire was talking to you about a deal in which he would make a profit … as a member of parliament out of a large-scale investment in which the New South Wales government was concerned?”

Berejiklian responded that she did not have a specific recollection of what was said.

Nor did Maguire, when it was put to him on Thursday.

Counsel assisting tried hard to pin him down on what detail he had communicated to the premier about the Badgerys Creek deal.

“I just don’t recall what I would have said,” he replied. “… I don’t know that I ever went to specifics.”

He conceded the two of them may have, “from time to time”, talked about the deal.

He could not recall whether he ever introduced the premier to William Luong or another person associated with the deal, Jimmy Liu.

“I may have indicated who Jimmy was,” Maguire said.

Time will tell what ICAC makes of Maguire’s schemes. Given crucial evidence remains suppressed from public scrutiny, it’s difficult to predict what the commission will find.

But already a couple of things are clear.

Immense damage has been done to the political standing of a premier who was previously seen – as Malcolm Turnbull rightly said on radio on Tuesday – as diligent, competent and focused on the management of the state of NSW.

Berejiklian barely survived two motions of no confidence in parliament on Wednesday. Her increasingly testy responses to media questioning betrays her increasing stress; the baiting by Opposition Leader Jodi McKay in the house that she was a “sounding board for corruption” seemed to sting.

The leader, who was previously widely seen as the government’s greatest strength, is suddenly cast, including by some of her own troops, as its greatest weakness. Now she really is vulnerable.

This article was first published in the print edition of The Saturday Paper on Oct 17, 2020 as "‘Poor Gladys’ rings hollow after premier’s ICAC grilling".

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Mike Seccombe is The Saturday Paper’s national correspondent.