Australia Post reveals luxury Cartier watches for senior managers actually cost $20K

Daniel Hurst and Mostafa Rachwani
·6-min read
<span>Photograph: Mick Tsikas/AAP</span>
Photograph: Mick Tsikas/AAP

Four Cartier watches given to Australia Post senior managers were worth nearly $20,000 in total, $8,000 more than the organisation’s chief executive told a parliamentary hearing this week.

Christine Holgate told Senate estimates on Thursday the watches, purchased in 2018 as a reward for the executives, were worth about $3,000 each.

But in a statement released on Friday evening, the Australia Post chair, Lucio Di Bartolomeo, said the four luxury timepieces actually cost $7,000, $4,750, $4,400 and $3,800, totalling $19,950.

Holgate “provided answers to questions relating to the purchase of four gifts for four Australia Post employees [but] since the appearance I have become aware of further details of the purchase and wish, as a matter of urgency, to clarify [their worth],” Di Bartolomeo said in a statement.

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Australia Post earlier confirmed that Holgate, stood-down following the revelations, would still receive pay while sidelined.

A federal government-ordered investigation into the lavish gifts may cost more to complete than the $19,950 spend that attracted Scott Morrison’s fury.

The two government departments leading the investigation are preparing to hire an external law firm for assistance – something that past records indicate doesn’t come cheaply.

While most of the public focus on Thursday was on the lavish watch revelations, the government revealed in a separate estimates hearing that external legal services associated with the investigation into the offices of the Coalition MPs Michael Sukkar and Kevin Andrews cost taxpayers $50,000.

AusTender records show two recent $25,000 contracts were awarded to law firm Ashurst Australia for “review for ministerial and parliamentary services”.

Under questioning from the Labor senator Don Farrell, finance department officials confirmed these contracts were for the review into the offices of Sukkar and Andrews – an investigation that found there was an insufficient basis to reach a finding of serious misuse of money or resources.

That outsourcing decision has attracted scrutiny because Sukkar was previously a senior associate of the law firm hired.

The separate investigation ordered by Morrison on Thursday after revelations about Australia Post’s spending will be conducted over the next four weeks by the communications and finance departments with help from an external law firm.

Guardian Australia understands the government is likely to reach an arrangement with a law firm next week and a budget hasn’t been settled yet.

The government is expected to clarify the terms of reference in the coming days, but it has already signalled it will take steps to ascertain the knowledge or otherwise of the then chair and board members.

Morrison played down the notion of broader cultural problems across commonwealth bodies on Friday, after the Asic chairman, James Shipton, also stood aside pending an investigation into spending on tax advice.

“I think there wouldn’t be a board member of a government agency or a CEO of a government agency that did not get my message yesterday – I think they got it with a rocket,” the prime minister told reporters on Friday.

“And so, my advice to them is to get it.”

Morrison rejected claims from the Collingwood Football Club president, Eddie McGuire, who told that Holgate – a Collingwood board member – was the victim of “a pile on” because “hacks” and “dullards” were trying to drag her down.

The prime minister said the revelations on Thursday would not have “passed any test with the Australian public when it comes to a company that is owned by the government”.

Holgate, the chief executive since 2017, said Australia Post had bought four Cartier watches in October 2018 for “a small number of senior people who had put an inordinate amount of work in” to a project to allow more people to do their banking at post offices. Di Bartolomeo on Friday clarified they were actually purchased in November 2018.

At the Senate estimates hearing, Holgate characterised it as “an award” that was given “on behalf of the board”.

But John Stanhope, who was chair at the time, told the Australian Financial Review he could not remember authorising the spending in 2018.

Di Bartolomeo, who was appointed as chair late last year, has said the board and management team would “fully cooperate” with the investigation.

He said the board was advised on Friday “that a check of board papers and minutes from this period show the then board was not asked to approve or note the purchase of those Cartier watches”. Di Bartolomeo said the “papers and minutes do not record any subsequent reference to the purchase” either.

Asked whether Holgate would continue to receive her normal salary during the investigation, an Australia Post spokesperson said: “Yes.”

Australia Post’s annual report shows Holgate’s base salary this year is $1.42m, which equates to $27,243 a week, or $108,972 over the four-week investigation timeframe.

The chief financial officer, Rodney Boys, is acting as chief executive.

The Labor senator Kimberley Kitching, who led the questioning of Australia Post executives about gifts, told Guardian Australia the investigation needed to be conducted in a “transparent” fashion.

The shadow assistant minister for government accountability also said Labor expected the eventual report “not to be hidden or swept under the carpet or not be acted upon, as we have seen so often with this government”.

Kitching called for Australia Post to focus on service delivery, saying she had been “inundated with phone calls and emails from people with their individual stories of their mail not being delivered”.

“Australians just want Australia Post to deliver their mail, properly and in a timely manner, and I don’t think that is too much to ask,” Kitching said.

The trade minister, Simon Birmingham, who is set to replace Mathias Cormann as finance minister at the end of this month, said the review would look at any cultural issues at Australia Post that may be behind the “completely unacceptable” decision to buy the watch gifts.

“If the review finds failings across the board, then the whole lot will be dealt with,” Birmingham told ABC TV on Friday.

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The opposition leader, Anthony Albanese, questioned why the prime minister had not taken such swift action on other recent issues.

“Well, no one’s heads have rolled over Western Sydney, have they?” Albanese said, referring to the Leppington triangle land purchase that is currently being investigated by the Australian federal police and the infrastructure department.

Albanese also queried the “enormous bonuses that had been given” to Australia Post executives.

Australia Post told the hearing on Thursday the total value of incentives awarded last financial year was $97.4m, although that included $21.6m in “thank you” payments to frontline workers for continuing to provide services through the pandemic.

But the board said it had decided not to pay incentive payments to Holgate and executive general managers for 2019-20.

That decision followed a public intervention by the communications minister, Paul Fletcher, demanding the executive team “honour its commitment” to reject bonuses at a time when the government had provided it with Covid-19 related regulatory relief.