Whitlam, Labour heads on mat for Arab cash affair

Press, Volume CXVI, Issue 34097, 8 March 1976, Page 17

Whitlam, Labour heads on mat for Arab cash affair

(New Zealand Press Association—Copyright/

CANBERRA, March 7. The leader of the Australian Opposition (Mr j Gough Whitlam) and two other Australian Labour Party leaders ; were strongly condemned by their own executive today after a three-day inquest into a proposed gift of Arab funds to the party. But Mr Whitlam, Prime Minister for three years ending last November, the partv secretary (Mr David Combe) and a Victorian executive member, Mr Bill Hartley retained their partypositions. The executive met for a total of more than 24 hours behind closed doors at party headquarters in Canberra to discuss allegations that Iraqi officials offered sAustsoo,ooo to the party’s depleted funds before last December’s Federal elections. Mr Robert Hawke, president of the party and of the

[powerful Australian Council lof Trade Unions, read a [statement to journalists after the meeting which said that at no time did the party officially engage in any negotiations to receive funds from Arab sources. “Grave errors” But a suggestion by Mr Hartley had been entertained by Mr Whitlam and Mr Combe, who without informing the executive had signed a proposed letter to a bank on the basis of the suggested transaction — moves which the statement described as "grave errors of judgment.” There was no immediate comment after the meeting from Mr Whitlam, whose party leadership had been described by observers as being in jeopardy over the controversy. The Labour leader flew immediately afterwards to his Sydney home. The row broke late last month after newspaper reports of a breakfast-time meeting on December 10 between Mr Whitlam, Mr Combe, and two visiting Iraqi emissaries at the Sydney home of a French-born businessman, Mr Harold Fischer.

All those at the meeting subsequently denied that a proposal for funds from Iraq had been discussed. Mr Fischer’s denial was made last week in a statement issued through his Sydney solicitors shortly after he arrived in Singapore from London. Later, he left his Singapore hotel and was listed by the police there as a missing person.

N on-c ommu nicat ion

Today’s statement, described by Mr Hawke as an executive resolution, said: “The principles, policies, and

programmes of this party are not up for sale or auc-1 tion, and yet the initiation j and endorsement of such aj proposal put the party at I risk of this charge. “There is no suggestion that they will involve themselves in such compromise. The grave errors of judgment were first, the suggestion being made by Mr Hartley on November 16, 1975, and entertained by Mr Whitlam and of Mr Combe; secondly, the non-commun-ication of the proposal to the officers and the executive; thirdly, the action of Mr Whitlam and Mr . Combe in signing a proposed tetter on February 11, 1976, td the Commonwealth Trading Bank on the basis of thjs proposed transaction.” The statement said the executive “condemned in the strongest terms” the actions of Mr Whitlam, Mr Combe, and Mr Hartley on the proposed gift of funds from Arab sources.

He went on to say that four points should be made clear from the evidence given to the executive —- no money in fact was received: none of the three persons involved stood in a position to profit personally from the proposed transaction: “None of them directly talked on this matter with the two Iraqis who visited Australia in December and no breach of the law was committed or intended.” Murdoch slated The executive also deplored wnat it called a concentrated attempt by the media generally “and the Rupert Murdoch press in particular” to interfere in and manipulate the party’s affairs. It accused the Liberal-Nat-tional Country Party coalition Government of the Prime [Minister (Mr Fraser) of inter-

fering on the issue for its own political advantage. Mr Fraser became Prime Minister last November II after the Governor-Genera! (Sir John Kerr) dismissed the Whitlam Government to

break a Parliamentary deadlock. The coalition scored a landslide election victory oni December 13. Mr Hawke told a news conference after the meeting that the executive’s resolution would be reported to the Federal Labour Parliamentary caucus at its next meeting, expected next Tuesday week. Mr Hawke said that as national president, he believed that Mr Whitlam should remain leader of the Parliamentary party, but said the executive did not presume to tell the caucus how to run its affairs. There had been no explicit reference at the meeting to the extent to which Mr Whitlams’s position might be weakened or endangered by the resolution, although i some members might have! had ’ it in their minds, he| said.